The Conservatism Principle

question 180

Multiple Choice

The conservatism principle:

• A)Requires that when there are more than one equally likely estimate of amounts expected to be received or paid in the future,then the less optimistic amount should be used
• B)Requires that a company use the same accounting methods period after period
• C)Requires that revenues and expenses be reported in the period in which they are earned or incurred
• D)Requires that all items of a material nature be included in financial statements
• E)Requires that all inventory items be reported at full cost