The Materiality Constraint Refers To

question 56

Multiple Choice

The materiality constraint refers to:

• A) the significance of an item of financial data in relation to other financial data.
• B) whether the increased cost of complying with an accounting principle is justified by the benefit that would result.
• C) the idea that "when in doubt,take the conservative action."
• D) existing accounting practices that have evolved based on the amount of debt that would be incurred by the business.

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Definitions:

Function

The natural purpose or action for which a person or thing is designed or exists.

Jurisdiction

The official power to make legal decisions and judgments, often within a defined territory or area of responsibility.

Judge

A designated authority tasked with making judgments in legal disputes within a courtroom.

Jury

A group of citizens assembled to make a decision or find facts in a legal case based on evidence presented.