Recording land at its cost rather than its appraisal value illustrates
A) the full disclosure principle.
B) the cost basis principle.
C) the realization principle.
D) the matching principle.

Question

Quizplus · Accepted Answer

Recording land at its cost rather than its appraisal value is an application of the cost basis principle, which states that assets should be recorded at their historical cost rather than their current market value. This principle is consistent with the conservatism principle, which encourages a more conservative approach to accounting by recording assets at the lower of their cost or market value to avoid overvaluing the assets.

Recording Land at Its Cost Rather Than Its Appraisal Value