A: The Going Concern concept justifies the charging of depreciation. R: Depreciation allocates the cost of an asset over its useful life. Choose the correct option. MCQ with Answer and Explanation
A: The Going Concern concept justifies the charging of depreciation. R: Depreciation allocates the cost of an asset over its useful life. Choose the correct option.
A. A is true but R is false
B. A is false but R is true
C. Both A and R are true but R is NOT the correct explanation of A
D. Both A and R are true and R is the correct explanation of A
Answer: Option D
Solution (By JKSSB Mock Tests)
The Going Concern concept assumes the business will continue indefinitely, which justifies capitalizing asset costs and depreciating them over their useful lives. R correctly explains the mechanism of depreciation.
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