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Introduction to Partnership and Partnership Final Accounts — Book Keeping & Accountancy STD 12 Commerce / Arts — Question

Maharashtra BoardEnglish MediumSTD 12 Commerce / ArtsBook Keeping & AccountancyIntroduction to Partnership and Partnership Final Accounts2 Marks
Question
Closing stock is always valued at market price.
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Answer

This statement is False.
As per the conservatism concept, the closing stock is always valued at cost price or market price whichever is less. If the market price of closing stock is greater than its cost then closing stock is recorded at cost.

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