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Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?
- a)Materiality.
- b)Prudence.
- c)Substance over form.
- d)All of above.
Correct answer is option 'B'. Can you explain this answer?
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Most Upvoted Answer
Accounting policy for inventories of Xeta Enterprises states that inve...
Explanation:
The accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on a weighted average basis or not realizable value. This policy is in line with the principle of prudence.
Prudence is an accounting principle that requires caution and conservatism in financial reporting. It states that in case of uncertainty, a conservative approach should be adopted to avoid overstating assets or income and understating liabilities or expenses. The principle of prudence is important in financial reporting as it ensures that financial statements are not misleading.
In the case of Xeta Enterprises, the policy of valuing inventories at the lower of cost or not realizable value is a conservative approach that reflects the principle of prudence. This policy ensures that the value of inventories is not overstated, and any potential losses are recognized in a timely manner.
Conclusion:
In conclusion, the accounting policy of Xeta Enterprises for valuing inventories reflects the principle of prudence. This policy ensures that the financial statements are not misleading and that potential losses are recognized in a timely manner.
The accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on a weighted average basis or not realizable value. This policy is in line with the principle of prudence.
Prudence is an accounting principle that requires caution and conservatism in financial reporting. It states that in case of uncertainty, a conservative approach should be adopted to avoid overstating assets or income and understating liabilities or expenses. The principle of prudence is important in financial reporting as it ensures that financial statements are not misleading.
In the case of Xeta Enterprises, the policy of valuing inventories at the lower of cost or not realizable value is a conservative approach that reflects the principle of prudence. This policy ensures that the value of inventories is not overstated, and any potential losses are recognized in a timely manner.
Conclusion:
In conclusion, the accounting policy of Xeta Enterprises for valuing inventories reflects the principle of prudence. This policy ensures that the financial statements are not misleading and that potential losses are recognized in a timely manner.
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Accounting policy for inventories of Xeta Enterprises states that inve...
Bcoz prudence concept says cost or net realizable value which ever is lower in this cost is less than net realizable value
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Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer?
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Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer?.
Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Accounting policy for inventories of Xeta Enterprises states that inventories are valued at the lower of cost determined on weighted average basis or not realizable value. Which accounting principle in followed in adopting the above policy?a)Materiality.b)Prudence.c)Substance over form.d)All of above.Correct answer is option 'B'. Can you explain this answer?.
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