BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -The accounting principle that would be violated is Consistency principle. The financial statements will not be consistent since the policies are always changing, which in turn leads to never-ending changes in the figures reported.

Detailed explanation-2: -You can’t use the accrual basis for your balance sheet and the cash basis for your cash flow statement. This would be inconsistent and violate the consistency principle. The accounting principle of consistency simply ensures that all financial records use the same methodology for greater accuracy and clarity.

Detailed explanation-3: -The accounting principle that is violated is consistency principle. According to consistency principle, the company should use same accounting treatment for similar events or transactions. It facilitates better comparison and understanding.

Detailed explanation-4: -In the given case, the company switches between the different inventory valuation methods. This is the violation of the consistency principle because the policy is not applied consistently is changed every year.