The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the cash or cash-equivalent amount given in exchange,is the:
A)Accounting equation.
B)Measurement (Cost)principle.
C)Going-concern assumption.
D)Realization principle.
E)Business entity assumption.

Question

Quizplus · Accepted Answer

The measurement (cost) principle requires all accounting information to be based on actual cost and mandates that assets and services should initially be recorded at the cash or cash equivalent amount given in exchange. This principle is important for providing reliable and objective information in financial statements.

The Accounting Principle That Requires Accounting Information to Be Based