The Materiality Constraint

question 277

Multiple Choice

The materiality constraint:

• A)Prescribes that accounting information is based on actual cost.
• B)Provides guidance on when a company must recognize revenue.
• C)Prescribes that only information that would influence the decisions of a reasonable person need be disclosed.
• D)Prescribes that a company record the expenses it incurred to generate the revenue reported.
• E)Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.

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Definitions:

Informed Consent

The process by which a patient or research participant agrees to undergo a specific medical intervention or participate in research after receiving and understanding all the relevant facts and implications.

Rawlsian

Pertaining to the philosophical ideas of John Rawls, especially his theory of justice which emphasizes fairness and the "veil of ignorance" principle in ethical decision making.

Utilitarian

A philosophical theory that suggests an action is right if it leads to the greatest happiness for the greatest number of people.

Paternalism

The practice or policy of limiting someone's freedom or making decisions for them in their supposed best interest.