Classifying by Consistent Principle Means That

question 51

Multiple Choice

Classifying by consistent principle means that:

• A)only one principle should ever be used
• B)only one or two principles should ever be used
• C)as many principles as possible should be used
• D)no principles should be used
• E)more than one principle may be used if necessary

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Definitions:

Depreciation Expense

The distribution of a physical asset's cost across its lifespan, mirroring its depreciation over time.

Tax Rate

The proportion of income or the value of a transaction that is collected by the government as tax, expressed as a percentage.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue, indicating the company's actual profitability.

Income Statement

A record detailing a firm's income, costs, and gains during a particular timeframe.