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    Question

    Which accounting concept or approach ensures that the

    financial statements present a true and fair view of the company’s financial position?
    A Comparability Correct Answer Incorrect Answer
    B Relatable Correct Answer Incorrect Answer
    C Prudence Correct Answer Incorrect Answer
    D Materiality Correct Answer Incorrect Answer
    E Relevance Correct Answer Incorrect Answer

    Solution

    The Prudence concept in accounting ensures that assets and income are not overstated, and liabilities and expenses are not understated. This conservative approach ensures that the financial statements present a true and fair view of the company’s financial position, reflecting a realistic and cautious assessment of the business's financial health.

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