A Company Decides to Ignore a Very Small Error in Their

question 111

Multiple Choice

A company decides to ignore a very small error in their inventory balance. This is an example of application of the:

• A)accounting conservatism.
• B)materiality concept.
• C)disclosure principle.
• D)consistency principle.

---

Definitions:

Birthday Cakes

Customarily decorated cakes made to celebrate and serve as a centerpiece during birthday festivities.

Marginal Cost

The increase in total cost that arises from producing one additional unit of a good or service, reflecting the cost of producing that marginal unit.

Producing Bagels

The process of making bagels, which involves mixing, shaping, boiling, and baking dough in a manner that achieves a distinct taste and texture.

Total Cost

A comprehensive collection of costs involved in manufacturing goods or services, covering both stable and changeable expenses.