Which One of the Following Statements Best Describes the Concept

question 32

Multiple Choice

Which one of the following statements best describes the concept of consistency?

• A)When uncertainty exists, understating assets, overstating liabilities, accelerating recognition of losses, and delaying recognition of gains is preferred.
• B)Accounting numbers are consistently market value.
• C)Different firms use identical accounting measurement methods for similar events.
• D)Similar events are measured using identical accounting procedures from period to period.

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Definitions:

Commercial Paper

An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories, and meeting short-term liabilities.

Corporate Bonds

Long-term debt issued by private corporations typically paying semiannual coupons and returning the face value of the bond at maturity.

Invoice Price

The initial price that the manufacturer suggests the retailer to sell their product for, before any adjustments like discounts or rebates.

Accrued Interest

Interest that has been incurred but not yet paid or received, often relevant in bond investments and loans.