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Going concern assumption and Consistency Concept

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(1) Going concern assumption : This is an important concept of accounting method. According to this concept when a business is started, it is assumed that the business is going to continue for a long time in the future. Hence it is called assumption of ongoing generation. Following are some examples based on the current generation concept: (i) Fixed assets are stated in the balance sheet at their cost after depreciation. In other words, productive or permanent assets at market value are not shown in the consolidated balance sheet. Longer in permanent assets business Purchased for use and not for resale. Therefore, instead of showing its market price as expected by the current generation, the market value is shown in the market value. (ii) Prepaid expenses are shown on the asset side of the balance sheet on the basis of going concern concept that the business is to continue for a long period of time and it is expected that the benefit of such prepaid expenses will be realized in the fut...
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Difference between Domestic Trade and Foreign Trade

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  The nature and challenges of foreign trade are different from domestic trade and the hurdles are higher and hence it is important to know the difference between them. Some of the points of difference are as follows: (1) Difference on the basis of size : Since foreign trade involves many countries, goods and services, laws, methods etc., the size of foreign trade is many times larger than internal trade. (2) Different Currencies and Modes of Payment  : Payments in internal trade are made in the currency of the home country. Also, payment has to be made from one bank to another bank in one’s own country. But in foreign trade one has to convert one’s own country’s currency into an accepted international currency. Exchange rates must be known, permissions must be obtained as per the laws of that country. Also, importers and exporters have to obtain a letter of credit from their home country’s bank for payment. (3) Differences in language, culture and society  : Exchange in ...
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Different Between Organized Money Market and Unorganized Money Market

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  The Indian money market can be divided into two parts: (A) Organized money market (B) Unorganized money market. (A) Organized Money Market: Being a formal money market, it is owned by the  Reserve Bank of India , commercial banks, mutual funds etc. The organized money market in India is controlled by the Reserve Bank of India. In order to maintain sufficient liquidity in the money market, the Reserve Bank of India changes the interest rate as per the need. Organized money market includes financial instruments like treasury bill, certificate of deposit, call money. The syndicated money market is systematically coordinated and regulated by the  Reserve Bank of India . (B) Unorganized Money Market: Since the unorganized money market is informal, it is not controlled by any central organization. The activities also run without any rules. This money market consists of moneylenders, landlords, mortgagors, country bankers, Shroff etc. All this lacks coordination. Unorganized m...
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