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WAEC Financial Accounting 2023 Question 3

Question 3

Accounting Concepts and Conventions

A business should not lay claim to any profit before it is earned. This is in accordance with the

  1. A.consistency concept.
  2. B.prudence concept.
  3. C.dual aspect concept.
  4. D.going concern concept.
Show the answer and explanation

Answer: B (prudence concept.)

Explanation

Prudence: profits are not anticipated, but losses are provided for.