Which of the Following Concepts (Or Principles)would Most Likely Require

question 49

Multiple Choice

Which of the following concepts (or principles) would most likely require that data be complete,neutral,and free from error?

• A) Cost principle
• B) Faithful representation principle
• C) Entity concept
• D) Going-concern concept

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Definitions:

Gross Profit Method

An inventory estimation technique that calculates cost of goods sold and ending inventory based on the gross profit margin.

Capital Budgeting

The process of planning and evaluating investments in long-term assets.

Payback Method

A capital budgeting technique that calculates the time needed to recoup the investment cost through net cash flows.

Cost of Capital

The minimum profit rate a company needs to achieve on its investment ventures to keep its market value stable and draw in capital.