The Objectivity Principle

question 264

Multiple Choice

The objectivity principle:

• A)Means that information is supported by independent,unbiased evidence
• B)Means that information can be based on what the preparer thinks is true
• C)Means that financial statement should contain information that is optimistic
• D)Means that a business may not recognize revenue until cash is received
• E)Means the assets acquired must be recorded and what the company paid for them

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Definitions:

User Cost

The opportunity cost of utilizing a good or service, often considering factors like depreciation and the potential benefit from alternative uses.

Resource Extraction

The process of obtaining raw materials from the natural environment, such as mining for minerals, drilling for oil, or logging forests, often associated with significant environmental impact.

Present

The current point in time or the moment that is occurring now.

Present Value

The current value of a future sum of money or stream of cash flows, given a specified rate of return.