The Convention of Consistency Refers to Consistent Use of Accounting

question 107

Multiple Choice

The convention of consistency refers to consistent use of accounting principles

• A)among firms.
• B)from period to period.
• C)throughout the current accounting period.
• D)within industries.

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Definitions:

Units

A measure of quantity, such as items or products, used in business operations and accounting.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision.

Fixed Cost

Costs that do not vary with the production volume or level of services provided, such as rent, salaries, and insurance.

Salary

Salary refers to a fixed regular payment, typically paid on a monthly or biweekly basis but often expressed as an annual sum, made by an employer to an employee.