Historically, _____ has described a preference for financial reporting such "that possible errors in measurement be in the direction of understatement rather than overstatement of net income and net assets."
A)conservatism
B)reliability
C)realization
D)recognition
E)relevance

Question

Quizplus · Accepted Answer

The statement describes the principle of conservatism in financial reporting, which suggests that financial statements should err on the side of caution and choose methods that result in understating rather than overstating income and assets.

Historically, _____ Has Described a Preference for Financial Reporting Such