Which of the following is allowed under generally accepted accounting principles?
A) A company was offered $60,000 for land that it had purchased for $15,000.The company did not sell the land but increased the Land account to $60,000.
B) An owner lists the full cost of his or her personal automobile,which is occasionally used for business purposes,on the company's balance sheet.
C) A large company recorded the $20 cost of a tool as an expense,although the item is expected to be used for 3 years.
D) The Equipment account shows a balance of $55,000.This amount represents the original cost of $75,000 less the accumulated depreciation of $20,000.

Question

Quizplus · Accepted Answer

Under generally accepted accounting principles (GAAP), small costs like the $20 tool can be expensed immediately due to materiality, even if the item has a useful life beyond the current accounting period.

Which of the Following Is Allowed Under Generally Accepted Accounting