Which One of the Following Is True According to Generally

question 62

Multiple Choice

Which one of the following is true according to Generally Accepted Accounting Principles?

• A)Depreciation may or may not be recorded at management's discretion.
• B)Income is recorded based on the matching principle.
• C)Costs are recorded based on the realization principle.
• D)Depreciation is recorded based on the recognition principle.
• E)Costs of goods sold are recorded based on the matching principle.

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Definitions:

Long Run

A period sufficient for all inputs, including physical capital and labor, to be adjusted in the production process.

Industry Supply Curve

A graphical representation that shows the relationship between the price of a good and the total output of the industry over a period of time.

Marginal Cost Curves

Graphs that depict the cost of producing one additional unit of a good or service, typically showing how costs vary with production volume.

Short-run

A time frame in which at least one factor of production is fixed, limiting adjustments to production levels.