Answer
Caution ought to be observed because numerous estimates and assumptions are made in accounting, and the income amount is an impression of these assumptions. In the event that under any circumstances the suspicions are not well established, distortions will show up in the income reported.
Work Step by Step
The aim of using the generally accepted accounting principles for the income statement is to gauge and report the consequences of operations as they happen for a predetermined period without perceiving any artificial modifications or exclusions.
