Answer to Question #78595 in Finance for Liam Johnston

Question

What do useful assumptions identify and what does that dictate? (50–80 words)

Answer 1

Key accounting assumptions state how a business is organized and operates. They provide structure to how business transactions are recorded. If any of these assumptions are not true, it may be necessary to alter the financial information produced by a business and reported in its financial statements.
Source:
https://www.accountingtools.com/articles/what-are-the-key-accounting-assumptions.html