Accounting · Accounting Concepts
Given below are two statements: one is labelled as Assertion A and the other is labelled as Reason R. Assertion A: In the absence of the Going Concern Concept, an enterprise would be required to charge the entire cost of a long-term asset to the revenue of the year it was purchased. Reason R: The Going Concern Concept assumes that a business will operate indefinitely, which facilitates the allocation of a fixed asset's cost over its estimated useful life. In the light of the above statements, choose the most appropriate answer from the options given below:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both A and R are correct but R is NOT the correct explanation of A
- 2A is correct but R is not correct
- 3Both A and R are correct and R is the correct explanation of A✓
- 4A is not correct but R is correct
Correct answer
Both A and R are correct and R is the correct explanation of A
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