Accounting · Provisions and Reserves
Which of the following is NOT correct regarding provisions?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is created for a known liability or expense pertaining to the current accounting period, the amount of which is not certain.
- 2It reduces taxable profits.
- 3It is made for strengthening the financial position of the business.✓
- 4It is a charge against profit.
Correct answer
It is made for strengthening the financial position of the business.
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