Chapter 2 - Theory Base of Accounting Assignments 28
Complete the following work sheet:
(i)
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If a firm believes that some of its debtors may ”²default”², it should act on this by making sure that all possible losses are recorded in the books. This is an example of the ___________ concept.
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(ii)
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The fact that a business is separate and distinguishable from its owner is best exemplified by the ___________ concept.
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(iii)
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Everything a firm owns, it also owns out to somebody. This co-incidence is explained by the ___________ concept.
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(iv)
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The ___________ concept states that if straight line method of depreciation is used in one year, then it should also be used in the next year.
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(v)
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A firm may hold stock which is heavily in demand. Consequently, the market value of this stock may be increased. Normal accounting procedure is to ignore this because of the ___________.
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(vi)
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If a firm receives an order for goods, it would not be included in the sales figure owing to the ___________.
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(vii)
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The management of a firm is remarkably incompetent, but the firms accountants can not take this into account while preparing book of accounts because of ________ concept.
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