1 The annual final accounts of businesses are normally prepared on the assumption that the business is a going concern. Required: Explain and give a simple illustration of: ( a ) the effect of this...

1

The annual final accounts of businesses are normally prepared on the assumption that the

business is a going concern.

Required:

Explain and give a simple illustration of:

(a) the effect of this convention on the figures which appear in those final accounts.

(b) the implications for the final accounts figures if this convention were deemed to be inoperative.

(Association of Chartered Certified Accountants)