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Accruals and prudence
The accruals concept requires future income (e.g. in relation to credit sales) to be accrued. The prudence concept dictates that caution should be exercised, so that if there is doubt about the subsequent receipt, no accrual should be made.
Consistency and prudence
If circumstances change, prudence may conflict with the consistency concept, which requires the same treatment year after year.
In both situations, prudence must prevail.
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∙ 11y ago
Folivi Cynthia
Prudence against Realization
Realization of profit of an organization, the amount of sales used is both credit and cash sales but this contradicts with prudence which says profits should not be anticipated since we are not sure that the credit sales will actually be realized
Twene Abednago
Yes
Twene Abednago
Yes
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