Which of the Following Is an Advantage of Replacement Cost

question 90

Multiple Choice

Which of the following is an advantage of replacement cost accounting over historical cost accounting?

• A) Replacement cost accounting is easier for companies to use.
• B) Replacement cost accounting requires fewer estimates.
• C) Replacement cost data is from a more recent data, and is more comparable across companies.
• D) Replacement cost data is easier to verify.

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Definitions:

Confidence

In statistics, it relates to the degree of certainty or reliability in an estimate or test result, often expressed as a confidence interval.

Monetary Error

A monetary error refers to inaccuracies or mistakes in financial transactions or accounting, which can impact financial statements or balances.

Confidence Interval

It refers to the range within which we expect a population parameter to lie with a certain degree of confidence, based on sample data.

Sample Mean

The average value of a given characteristic within a sample drawn from a population.