Theoretical FrameworkQuestion 4954 of 110
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A concern proposes to discontinue its business from December, 2020 and decides to dispose of its plants within a period of 3 month§. The Balance Sheet as on 31st December, 2020 should continue to indicate the plants at its historical costs as the assets will be disposed of after the Balance Sheet date. [Nov. 2020, 2 Marks]

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Detailed Solution & Explanation

False: As per going concern concept any business shows its Fixed Assets at its historical cost but in case of discontinuance of business they should be shown at their expected realizable value.

About This Chapter: Theoretical Framework

Paper

Paper 1: Accounting

Weightage

5-10%

Key Topics

Policies, Standards (Ind AS), Vocabulary

This chapter covers Policies, Standards (Ind AS), Vocabulary and is part of Paper 1: Accounting in the CA Foundation exam.

View Official ICAI Syllabus

Exam Strategy Tip

This topic carries 5-10% weightage. Focus on understanding core concepts rather than memorizing.

Key Concepts to Understand

Balance Sheet

A statement showing the financial position of a business at a particular date, listing all assets on one side and all liabilities and capital on the other side. It is not an account but a statement.

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