Which of the following is a result of conservative accounting practices?
A)Higher income,higher assets,and lower liabilities.
B)Lower income,higher assets,and lower liabilities.
C)Higher income,lower assets,and lower liabilities.
D)Lower income,lower assets,and higher liabilities.

Question

Quizplus · Accepted Answer

Conservative accounting practices typically result in recognizing expenses and liabilities sooner rather than later, and delaying the recognition of revenues and assets. This approach leads to lower reported income (because expenses are recognized promptly), lower assets (because revenues are not overestimated and some assets might be undervalued), and higher liabilities (because obligations are recognized as soon as possible).

Which of the Following Is a Result of Conservative Accounting