Accounting · Accounting Concepts and Principles
According to the 'Prudence Concept' (Conservatism) in accounting, which of the following practices should be followed?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Record profits in advance to boost financial statements.
- 2Provide for all anticipated losses but do not recognize unrealized gains.✓
- 3Ignore anticipated losses until they actually occur.
- 4Recognize all anticipated gains immediately.
Correct answer
Provide for all anticipated losses but do not recognize unrealized gains.
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