An Item Is Considered Material If

question 65

Multiple Choice

An item is considered material if

• A) it doesn't cost a lot of money.
• B) it is of a tangible good.
• C) it is likely to influence the decision of an investor or creditor.
• D) the cost of reporting the item is greater than its benefits.

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Definitions:

Accounting Systems

Organized frameworks used by businesses to record, monitor, and process financial transactions and information, facilitating effective financial management and decision-making.

Ledger

A book or computer file with separate sections for each account.

Accounting Transactions

Financial activities that affect the accounting equation, documented through the exchange or transfer of economic value.