The Accounting Principle That Requires That the Cost Flow Assumption

question 175

Multiple Choice

The accounting principle that requires that the cost flow assumption be consistent with the physical movement of goods is

• A)called the matching principle.
• B)called the consistency principle.
• C)nonexistent; that is, there is no such accounting requirement.
• D)called the physical flow assumption.

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Definitions:

Maturity Value

The amount payable to an investor at the end of a bond's term or at the time of maturity, including both the principal and interest.

Income Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

Capital Gain Yield

The appreciation in the price of an investment, expressed as a percentage of the initial investment cost.

Total Rate Of Return

The overall return on an investment, including both capital gains and income, expressed as a percentage of the initial investment.