Accounting Multiple Choice Question – 13 May 2019

The consistency concept means that…?

Select ONE answer:

1. when preparing the accounts of a firm, one should normally account for similar items in the same way from one accounting period to the next.
2. firms in the same industry must account for similar items in the same way.
3. firms may never change the way in which they prepare their accounts.
4. None of the above.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct
2. The consistency concept requires consistency of treatment over time, not across firms.
3. Firms may change the way in which they prepare their accounts if the new way is more ‘correct’ than the old.
4. Not correct

 

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