Lorna Smith Decided to Start Her Own CPA Practice as a Professional

question 158

Multiple Choice

Lorna Smith decided to start her own CPA practice as a professional corporation,Smith CPA PC.Her corporation purchased an office building for $35,000 that her real estate agent said was worth $50,000 in the current market.The corporation recorded the building as a $50,000 asset because Lorna believes that is the real value of the building.Which of the following concepts or principles of accounting is being violated?

• A)cost principle
• B)economic entity assumption
• C)monetary unit assumption
• D)going concern assumption

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Definitions:

Performance Goals

Objectives aimed at demonstrating competence or achieving a specific standard of excellence in a task.

Approach Goals

Objectives that focus on achieving a positive outcome or moving towards a desirable object or event.

Performance Goals

Objectives aimed at demonstrating competence or achieving a specific standard of excellence in a task or activity.

Performance Goal

Objectives centered around achieving a specific standard of proficiency on a task, usually within a specified time.