Accounting for IGCSE & O level - Final Statements (Section 5 - No. 17)
The rule for valuing inventories is that they should be valued at the lower of their cost or net realisable value. This rule is a practical application of which accounting principle?
Going Concern
Consistency
Prudence
Materiality
Explanation
The principle of prudence emphasizes caution and conservatism in financial reporting to avoid overstating assets and profits.