FAPS Flashcards by Jack Jolliff

Q

Which two accounting principles relate to depreciation

A

Accruals and prudence.

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Q

Which accounting principle relates to the following statement: “Inventory is valued at the lower of cost and NRV”

A

Prudence

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Q

Which accounting principle relates to the following statement: “Depreciation is charged at 10% straight line per year”

A

Consistency

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Q

True or false? Businesses use profitability ratios to aid control, decision making and planning for the business.

A

True

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Q

True or false? The profit and loss account is part of the double entry system.

A

True

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