Which One of the Following Is Violated When a Company

question 87

Multiple Choice

Which one of the following is violated when a company records cost of goods sold expense at the time when inventory is purchased?

• A)Relevance
• B)Historical cost
• C)Matching
• D)Revenue recognition criteria

---

Definitions:

Functional Currency

The currency of the primary economic environment in which an entity operates, typically used in its financial reporting.

Foreign Currency Transaction

A transaction that is denominated or requires settlement in a foreign currency.

Denominated

Indicates the unit of currency in which a financial transaction or instrument is specified.

FOB

Free On Board (FOB) is an international commerce term used to indicate whether the seller or buyer is responsible for goods damaged or destroyed during shipping, specifying the point at which the risk of loss shifts.