Going Concern Concept Homework Answers
Going Concern is one of the most common concepts or ideas in accounting studies. Students are often given assignments and projects on the various topics under this concept. However, while writing the going concern concept homework answers, we often find students facing a lot of trouble. This is because they lack a clear knowledge of the subject, as well as because of the lack of understanding about how to write a project!
If you too have been facing this problem, relax! This discussion will certainly help you.
Understand what Going Concern Concept is:
Accountancy students, who have been worrying about how going concern works and haven’t been able to garner the courage to ask the professor, here is a brief and easy definition for you!
Going Concern is an assumption that a company or business will indefinitely continue to operate in the market, within a next period of time. In simpler terms, the business will not be sold or will not get closed down, at least at any time in the near future.
Thus, it can be said that the business will be operative for long enough to –
- Accomplish its objectives
- Carry out its commitments
- Manage its obligations.
Thus, it can be said that the companies that are going to function or operate in the near future are a going concern. And the companies that are not going to stay operative in the near future are not a going concern.
Problems with going concern concept homework answers:
When I was an Accountancy student, Going Concern Concept was one of the most difficult ones for me to understand. However, I often, unfortunately, received projects and assignments that were purely based on this subject. I wondered why this happened to me, while many of my friends received topics that I was confident in!
Well, not going back to those painful days, it is better to focus on how I managed to learn this and excelled in all of my Going Concern Concept homework assignments.
One of the best ways is to seek assistance from professional homework help services. That helps students a lot in clearing their doubts. The best thing about these service providers has excellent teachers, who with their professional guidance advises students and helps them to get a better understanding of these topic issues. This is no doubt a good suggestion to all students. Before you start writing the going concern concept homework answers, understand its problems.
- An increase in the gearing level can lead to high financial risks. This can cause the company to be vulnerable to delayed loan principle and loan interest payment.
- Another problem is an increase in the short term overdraft and short term borrowing level, which the business does not support.
- The liquidity position of the company being deteriorated is not supported by the financing arrangements of the company.
- Loss or deterioration of the financial strength of a company, leading to encountering serious litigations, is another important problem that Going Concern Concept should solve. Thus, possible settlements are left unpaid.
- A major customer of the company may go bankrupt, and this can cause a serious problem for the operation of the business. Hence, it must be taken into consideration.
- The profitability of a company may be affected seriously when there is a significant amount of trading loss for the past several years.
- Over trading and aggressive growth strategy are also serious problems that Going Concern Concept should consider.
Now that you have understood these problems that must be considered before writing the going concern concept homework answers, completing your homework would be easier.
Procedures to complete Going Concern Concept Homework:
Though every problem or topic is individual, when it comes to assignments; still you need to follow certain procedures. These procedures are almost always constant. These would include –
- Analytical procedures
- Review of debt and loan agreements
- Review of subsequent events
- Litigation inquiry, assessments, and claims
- Going through the details of board of directors, stockholders and important committees of the board
- Maintaining financial support by confirming third party details of arrangements.
While you solve your going concern concept homework answers, always try to keep these procedures in mind. They are the basics that will help you.
Plans that will help you:
Along with the procedures, management plans also help in solving Going Concern Concept problems. Some plans that are personally recommended to all students include –
- Plans for disposing of assets
- Plans for delaying and reducing expenditure
- Plans for restricting debt or borrowing money
- Plans for increasing ownership equity.
When you hire the professional tutors or seek help from the professionals who help in solving class projects or assignments, you can be assured that these will be discussed in details.
General Tips to Help:
As a teacher, it is a common sight where most Accounting students forget to keep their projects attractive and engaging. The purpose is to fetch more score and get a good rank in your examination.
- Therefore, whenever you write the going concern concept homework answers, make sure that you elaborate each of your points in separate sections.
- Use as many examples and diagrams or charts as possible.
- The crispier is your content, the better marks you will be able to fetch.
- But of course, make sure that you have absolutely fresh content every time, without any plagiarism.
If you are not confident about these things, seek professional help. They come in handy and certainly help you in clearing your doubts.