Which of the Following Accounting Principles Would Require That All

question 172

Multiple Choice

Which of the following accounting principles would require that all goods and services purchased be recorded at cost?

• A) Going concern principle
• B) Currency principle
• C) Historical cost principle
• D) Business entity principle
• E) Revenue recognition principle

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Definitions:

Depreciation

The method of allocating the cost of a tangible or physical asset over its useful life.

Royalties

Payments made to owners of intellectual property, like patents or copyrights, in exchange for usage rights.

Form 1099-MISC

A document used to report miscellaneous income such as payments made to independent contractors, rent, or awards.

Payer

An entity or individual who makes a payment to another.