The cost principle requires that when assets are acquired, they be recorded at
A) appraisal value.
B) historical cost.
C) market price.
D) exchange price paid.

Question

Quizplus · Accepted Answer

The cost principle states that assets should be recorded at their historical cost, which is the actual cost paid to acquire them. This ensures that financial statements accurately reflect the resources that the company has invested in its operations. Appraisal value, market price, and exchange price paid may be relevant in certain circumstances but are not the primary basis for recording asset values according to the cost principle.

The Cost Principle Requires That When Assets Are Acquired, They