An item is considered material if
A) it doesn't cost a lot of money.
B) it is of a tangible good.
C) it is likely to influence the decision of an investor or creditor.
D) the cost of reporting the item is greater than its benefits.

Question

Quizplus · Accepted Answer

Materiality refers to the significance of an item or event to a company's financial statements. An item is considered material if it is likely to influence the decision of an investor or creditor. Materiality is not based on the cost of the item or the cost of reporting it. Tangibility is also not a factor in determining materiality.

An Item Is Considered Material If