The Consistency Principle States That a Business Should Use the Same

question 77

True/False

The consistency principle states that a business should use the same accounting methods and procedures from period to period.

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Definitions:

Stock Dividend

A dividend payment made in shares of the company's stock rather than cash.

Retained Earnings

The portion of net earnings not paid out as dividends, but retained by the company to be reinvested in its core business, or to pay debt.

Plant Expansion

The process of increasing the capacity or capabilities of existing facilities through additional space, equipment, or technology.

Dividend Declarations

A corporate action where a company announces the payment of dividends to its shareholders.