The measurement method that requires all transactions to be recorded based on actual amount of cash received or paid, or cash-equivalent amount given in exchange, is the
A) current cost method
B) historical cost principle
C) fair value method
D) value in use method
E) fulfilment method

Question

Quizplus · Accepted Answer

The current cost method requires all transactions to be recorded based on actual amount of cash received or paid, or cash-equivalent amount given in exchange. Therefore, A) current cost method is the best choice for this measurement method. The historical cost principle records transactions at the original cost, fair value method records transactions at market value, value in use method measures assets based on their present value, and fulfilment method is used for revenue recognition.

The Measurement Method That Requires All Transactions to Be Recorded