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What Going Concern Assumption ??.. |
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Answer» The going concern principle is the assumption that a business will continue to exist in the near future, in other words, that it will not liquidate or be forced out of business......,Hope it helps... Going Concern Assumption :This concept assumes that an enterprise has an\xa0indefinite life or existence.\xa0It means that the intentions of the business are to continue for sufficiently longer period of time. It will not be dissolved or liquidated in the immediate future. If a machinery purchased is expected to last (to be used for) next 10 year, then the cost of machinery will be spread over the next 10 year for calculating net profit or loss of each year (Dep. Charged.)The full cost of the machine would not be treated as expense in the year of purchase itself.\xa0Market value of the asset is irrelevant\xa0and is\xa0not recorded in the balance sheet,\xa0as these assets are not going to be sold in the near future. |
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