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The Going Concern Concept assumes the business will:
ALiquidate within one accounting period
BContinue to operate for a longer period of time in future
CBe sold to another owner within 3 years
DHave its life capped at 50 years
Answer & Solution
Correct answer: B. Continue to operate for a longer period of time in future
1. Per OCR: "Accounting assumes that business will continue to operate for a longer period of time in future."
2. No intention nor necessity to curtail operations.
3. Justifies depreciation over useful life + carrying assets at historical cost.
_Source: ICMAI BoS CMA Foundation Paper 2 (FFCA) — Paper2_07042026.pdf, Module 1 §1.2.2.1 (page 16)_