The proprietary theory approach largely coincides with the components of income measurement as it is presently construed in historical cost-based systems.

Question

Quizplus · Accepted Answer

The proprietary theory approach focuses on measuring the economic resources owned by the business, which aligns with the components of income measurement in historical cost-based systems. Both approaches prioritize tracking changes in assets, liabilities, and equity to determine income or profit.

The Proprietary Theory Approach Largely Coincides with the Components of Income