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

Question

Quizplus · Accepted Answer

The cost principle requires assets and services to be recorded at their initial cash value, also known as actual cost. This principle ensures that accounting information is reliable and objective.

The Accounting Principle That Requires Accounting Information to Be Based