The Accounting Principle That Requires Accounting Information to Be Based

question 12

Multiple Choice

The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the cash or cash-equivalent amount given in exchange,is the:

• A)Accounting equation.
• B)Measurement (Cost)principle.
• C)Going-concern assumption.
• D)Realization principle.
• E)Business entity assumption.

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Definitions:

Competitive Market

A market structure characterized by a large number of buyers and sellers, where no single entity has significant power to influence the market price.

Quantity Demanded

The specific amount of a good or service that consumers are willing and able to purchase at a given price.

Average Revenue

The amount of income generated per unit of sale or, broadly, the total revenue divided by the number of units sold.

Competitive Industry

A competitive industry is one where numerous firms are in competition with each other to sell similar products or services, with none having a dominant market position.