Going concern in financial management, Financial Management

Assignment Help:

Going Concern in Financial Management

Going concern means in which business activities will continue for a fairly long period of time unless and until the business has entered into a procedure of liquidation.  This concept does not mean in which the business will continue for an infinite period of time, but it denotes in which the business is going to run for fairly long period of time so as to carry out business plans.

Under this concept it is assumed in which the business activities will continue for at least a period of time essential to meet its present contractual obligations and recover the original cost of its fixed assets.  This concept denotes in which the assets are obtains for utilization and not for resale. Under this concept utilization of resources for producing excellence and realization of revenue through their sale assumes significance.  Income is determined after charging cost of utilised resources to the revenue of that period.  Revenue and costs are recognized as and while they are earned or incurred and recorded in the financial statement of the period that they relate to.  This denotes that valuation of the business is completed on the basis of earning power rather than on the primary of the liquidation price of the enterprise.  This concept justifies for revenue realisation.  The revenue would be deemed to be realized along with the transfer of ownership of goods or services rendered.  Goods could be sold for cash or credit, thus earning of revenue is hard from cash collection from customers.


Related Discussions:- Going concern in financial management

Operating budget, Operating Budget It is a collection or set of formal ...

Operating Budget It is a collection or set of formal financial documents that details expected expenses and revenues, as like all other expected operating and financial transac

Explain the rapid development of interest rate swap market, If the cost ben...

If the cost benefits of interest rate swaps would similarly be arbitraged away in competitive markets, what other descriptions exist to explain the rapid development of the interes

Semi-strong-form of efficiency, Semi-Strong form level of Efficiency This...

Semi-Strong form level of Efficiency This level states that share prices reflects all available public information. (past and present information). If the market has achieved thi

Evolution of hedge funds, Evolution of Hedge Funds: The establishment o...

Evolution of Hedge Funds: The establishment of the first Hedge Fund in the United States in the year 1949 by Alfred W. Jones marked the evolution of Hedge Fund industry. It was

Discuss about the materiality, Discuss about the Materiality An item ca...

Discuss about the Materiality An item can be considered material if its omission would reasonably influence the decisions of an addressee of report, a misstatement is material

Explain about the term investment intermediaries, Explain about the term in...

Explain about the term investment intermediaries. Investment intermediaries: Investment intermediaries contain finance companies, mutual funds and investment banks and se

The selling process, The Selling Process The four key elements that con...

The Selling Process The four key elements that constitute the selling process are: (i) identification of prospective buyers, (ii) selection of the type of selling process to be

Current yields for treasury bond, ACT presently is all-equity financed. Thi...

ACT presently is all-equity financed. This reflects the stance of the former CEO, a dominant personality who stated repeatedly: "I don't want us to be in thrall to the demands of t

Explain arr and payback, ARR AND PAYBACK (a) Accounting rate of retur...

ARR AND PAYBACK (a) Accounting rate of return (ARR) is a computation of the return on an investment where the annual profit prior to interest and tax is expressed as a percen

Types of mutual funds, Types of Mutual Funds The objectives of a Mutual...

Types of Mutual Funds The objectives of a Mutual Fund are as follows: To provide an opportunity for lower income groups to acquire property without much difficulty in the

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd