Which of the Following Principles States That a Business's Financial

question 41

Multiple Choice

Which of the following principles states that a business's financial statements must report enough information for outsiders to make knowledgeable decisions about the company?

• A) conservatism
• B) materiality concept
• C) disclosure principle
• D) consistency principle

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Definitions:

Holdback

A specified percentage that a person owing funds on a construction contract must retain for a specified period to protect against claims made by the suppliers of goods and services.

Real Property

Land and anything permanently affixed to it, such as buildings and trees, including both the physical property and the rights associated with owning it.

Personal Property

Objects or belongings that are not fixed to land or buildings, including both physical items and intangible rights.

Chattel

Personal property that is movable, as opposed to real estate or land.