The Accounting Convention That States That Every Transaction Has at Least

question 40

Multiple Choice

The accounting convention that states that every transaction has at least two effects on the accounting equation, so that after the transaction is processed, the equation remains in balance is the:

• A)going concern/continuity convention.
• B)objectivity/reliability convention.
• C)conservatism/prudence convention.
• D)dual aspect convention.

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Definitions:

Minimizing Losses

A strategy or approach adopted by businesses or individuals aiming to reduce the amount of money lost in operations or investments.

Output

The total quantity of goods or services produced by a company, industry, or economic system.

Price

The amount of money required to purchase a good, service, or asset, determined by factors like supply and demand, production costs, and market competition.

Economies Of Scale

The cost advantage that arises with increased output of a product, where the cost per unit decreases as production expands.