According to generally accepted accounting principles, a company's balance sheet should show the company's assets at
A) the cash equivalent value of what was given up or the asset received, whichever is more clearly evident
B) the market value of the asset received in all cases
C) the cash outlay only, even if part of the consideration given was something other than cash
D) the best estimate of a certified internal auditor
E) current replacement cost

Question

Quizplus · Accepted Answer

Generally accepted accounting principles dictate that assets should be recorded at the cash equivalent value of what was given up or the asset received, whichever is more clearly evident. This ensures that the balance sheet reflects the true economic value of the assets. Using market value, cash outlay only, or current replacement cost may not accurately represent the value of the assets. A certified internal auditor may provide an estimate, but it is not the required basis for asset valuation.

According to Generally Accepted Accounting Principles, a Company's Balance Sheet