The Conservatism Principle in Accounting Means That a Company Should

question 14

Multiple Choice

The conservatism principle in accounting means that a company should:

• A)report enough information in its financial statements for outsiders to make knowledgeable decisions about the company.
• B)report items in the financial statements at the least favorable amounts.
• C)use the same accounting methods and procedures from period to period.
• D)perform strictly proper accounting for items and transactions that are significant to the company's financial statements.

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Definitions:

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