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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): The analysis of financial statements does not disclose the current worth of the business.
Reason (R): Financial statements are prepared on cost principles.
- a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
- b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
- c)Assertion (A) is true, but Reason (R) is false .
- d)Assertion (A) is false, but Reason (R) is true.
Correct answer is option 'A'. Can you explain this answer?
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Most Upvoted Answer
Directions : In the following questions, a statement of Assertion (A)...
Assertion and Reasoning
Assertion (A): The analysis of financial statements does not disclose the current worth of the business.
Reason (R): Financial statements are prepared on cost principles.
Explanation
The analysis of financial statements includes the interpretation and evaluation of financial data to provide information that is useful in decision making. However, financial statements do not disclose the current worth of the business, which is the total value of its assets minus its liabilities. This is because financial statements are prepared based on historical cost principles, which means that assets are recorded at their original cost and not their current market value.
The Reason (R) is also true because financial statements are indeed prepared on cost principles. This means that assets are recorded at their original cost, and any change in their market value is not reflected in the financial statements. This is because the cost principle provides a more objective and verifiable basis for accounting for assets.
Conclusion
Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A). The current worth of a business cannot be determined solely by analyzing financial statements because they are prepared on cost principles, which do not reflect changes in the market value of assets.
Assertion (A): The analysis of financial statements does not disclose the current worth of the business.
Reason (R): Financial statements are prepared on cost principles.
Explanation
The analysis of financial statements includes the interpretation and evaluation of financial data to provide information that is useful in decision making. However, financial statements do not disclose the current worth of the business, which is the total value of its assets minus its liabilities. This is because financial statements are prepared based on historical cost principles, which means that assets are recorded at their original cost and not their current market value.
The Reason (R) is also true because financial statements are indeed prepared on cost principles. This means that assets are recorded at their original cost, and any change in their market value is not reflected in the financial statements. This is because the cost principle provides a more objective and verifiable basis for accounting for assets.
Conclusion
Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A). The current worth of a business cannot be determined solely by analyzing financial statements because they are prepared on cost principles, which do not reflect changes in the market value of assets.
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Directions : In the following questions, a statement of Assertion (A)...
As the financial statements are prepared on the cost principle, its analysis does not disclose the current financial position of the company.
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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?
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Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?.
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?.
Solutions for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): The analysis of financial statements does not disclose the current worth of the business.Reason (R): Financial statements are prepared on cost principles.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
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