The stable monetary unit assumption:
A)ensures that accounting records and statements are based on the most reliable data available.
B)holds that the entity will remain in operation for the foreseeable future.
C)maintains that each organization or section of an organization stands apart from other organizations and individuals.
D)enables accountants to ignore the effect of inflation on the accounting records.

Question

Quizplus · Accepted Answer

The stable monetary unit assumption enables accountants to ignore the effect of inflation on the accounting records by assuming that the value of money remains constant over time. This means that financial statements are prepared using historical cost rather than current market value.

The Stable Monetary Unit Assumption