Expensing the cost of copy paper when the paper is acquired is an example of
A) Materiality.
B) Cost constraint.
C) Conservatism.
D) Industry practices.

Question

Quizplus · Accepted Answer

Expensing the cost of copy paper is an example of materiality because the cost of paper is minimal and immaterial, and it would not make sense to track it as an asset on the balance sheet. Materiality is the concept that an item is only relevant to financial reporting if it would make a difference to a user's decision-making process.

Expensing the Cost of Copy Paper When the Paper Is