Asset losses or impairment are recognized when they occur,while asset gains are not recognized until realized.

Question

Quizplus · Accepted Answer

This statement is true as per the accounting principle of conservatism, which requires that potential losses be recognized as soon as they become known or reasonably estimated, while potential gains are only recognized when they are realized. This helps to ensure that financial statements present a more accurate and conservative picture of a company's financial position and performance.

Asset Losses or Impairment Are Recognized When They Occur,while Asset