Proponents of Historical Cost Ordinarily Maintain That in Comparison with All

question 58

Multiple Choice

Proponents of historical cost ordinarily maintain that in comparison with all other valuation alternatives for general purpose financial reporting, statements prepared using historical costs are more

• A)reliable.
• B)relevant.
• C)indicative of the entity's purchasing power.
• D)conservative.

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Definitions:

Defensive Industry

Industries that are relatively unaffected by economic cycles and fluctuations, such as utilities and consumer staples, because their products are always in demand.

Automobile Industry

A global sector that involves the design, development, manufacturing, marketing, and selling of motor vehicles.

Food Industry

The sector that covers the processing, preparation, and distribution of food products from agricultural production to consumers.

Total Revenue

The total income generated by a company from its business activities before any expenses are subtracted.