The Materiality Principle

question 92

Multiple Choice

The materiality principle:

• A)Permits use of the direct write-off method.
• B)States that an amount can be ignored if its effect on financial statements is unimportant to the user.
• C)Prohibits use of the direct write-off method.
• D)States that an amount can be ignored if its effect on financial statements is unimportant to the user and permits use of the direct write-off method.
• E)Both permits and prohibits use of the direct write-off method.

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Definitions:

Attitudes

A settled way of thinking or feeling about something, typically reflected in a person's behavior.

Naturalistic Observation

A research method in which subjects are observed in their natural environment without any manipulation by the observer.

Case Studies

Research method involving a detailed and intensive analysis of an individual case or cases, often used in clinical, social, or business research.

Surveys

Research methods involving the collection of data from a sample of individuals through their responses to questions.