The Materiality Constraint

question 277

Multiple Choice

The materiality constraint:

• A)Prescribes that accounting information is based on actual cost.
• B)Provides guidance on when a company must recognize revenue.
• C)Prescribes that only information that would influence the decisions of a reasonable person need be disclosed.
• D)Prescribes that a company record the expenses it incurred to generate the revenue reported.
• E)Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.

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Definitions:

Concurring Opinion

An additional opinion in a court case that agrees with the majority decision but offers different reasoning or emphasizes a particular point.

Plurality Opinion

A judicial opinion agreed to by more justices than any other opinion in a case but not achieving a full majority.

Bill of Rights

A document listing the fundamental rights and freedoms that are protected and guaranteed to all citizens, often forming a part of a country's constitution.

First Ten Amendments

Collectively known as the Bill of Rights, these amendments to the U.S. Constitution guarantee fundamental rights and protections to American citizens.