The two recognition criteria for the elements of financial statements are:
A) Faithful representation and Existence of economic benefits.
B) Existence of economic benefits and Control.
C) relevant and faithful representation.
D) Probability of occurrence and Control.

Question

Quizplus · Accepted Answer

The two recognition criteria for the elements of financial statements are relevance and faithful representation. Relevance means that the information is capable of making a difference in the decisions made by users. Faithful representation means that the information is complete, neutral, and free from error. The other options listed are not recognition criteria for financial statement elements.

The Two Recognition Criteria for the Elements of Financial Statements