The Conservatism Constraint Prescribes That

question 21

Multiple Choice

The conservatism constraint prescribes that:

• A)When multiple estimates of amounts to be received or paid in the future are equally likely,then the least optimistic amount should be used.
• B)A company use the same accounting methods period after period.
• C)Revenues and expenses are reported in the period in which they are earned or incurred.
• D)All items of a material nature are included in financial statements.
• E)All inventory items are reported at full cost.

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Definitions:

Proposals Presented

This refers to the act or instance of presenting ideas, plans, or suggestions for consideration by others.

Committee Considered

The phrase is typically used when a proposal or issue has been presented to a committee for review, deliberation, or decision-making.

Best

Describes the highest quality, greatest degree, or utmost excellence compared to all others in a category or group.

Correct Punctuation

The proper use of symbols such as commas, periods, and question marks in writing to clarify meaning.