When a business reports an asset at an inflated dollar amount,is has violated the measurement issue of
A)recognition.
B)valuation.
C)classification.
D)realization.

Question

Quizplus · Accepted Answer

The valuation issue requires assets to be reported at their fair value or historical cost, whichever is more reliable. If a business reports an asset at an inflated dollar amount, it has violated this principle of accuracy in asset measurement. Recognition refers to the process of identifying and recording transactions in financial statements, classification relates to grouping similar items for presentation, and realization concerns the timing of when revenues and gains are recorded.

When a Business Reports an Asset at an Inflated Dollar