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:

Undesirable Emotions

Feelings or emotional states that are generally considered negative or unpleasant, such as sadness, anger, or fear, which people often seek to avoid or manage.

Conflicts

Involves disagreements, disputes, or clashes between individuals or groups due to differing views or objectives.

Sensing Type

A personality trait characterized by a preference for perceiving information through the five senses and focusing on concrete, tangible data.

Myers-Briggs Typology

A personality classification framework that categorizes individuals into 16 personality types based on preferences in how they perceive the world and make decisions.