Primecoat could get its annual financial statements two days earlier if it shifted substantial human resources from other operations to the annual report project. Management decided the value of the earlier report was not worth the added commitment of resources. The concept demonstrated is:
A)Timeliness.
B)Materiality.
C)Relevance.
D)Cost effectiveness.

Question

Quizplus · Accepted Answer

The concept demonstrated in this scenario is cost effectiveness, as management is weighing the cost of committing additional resources to the annual report project against the benefits of receiving the financial statements two days earlier. Timeliness, materiality, and relevance are not as relevant to the specific decision being made in this scenario.

Primecoat Could Get Its Annual Financial Statements Two Days Earlier