Which of the Following Statements Is Not Consistent with Generally

question 57

Multiple Choice

Which of the following statements is not consistent with generally accepted accounting principles relating to asset valuation?

• A) Many assets are originally recorded in accounting records at their cost to the business entity.
• B) Subtracting total liabilities from total assets indicates what the owner's equity in the business is worth under current market conditions.
• C) Accountants assume that assets such as office supplies, land, and buildings will be used in business operations, rather than being sold at current market prices.
• D) Accountants prefer to base the valuation of assets upon objective, verifiable evidence rather than upon appraisals or personal opinion.

---

Definitions:

Inspiratory Reserve Volume

The additional amount of air that can be inhaled after a normal inhalation, increasing lung volume.

Expiratory Reserve Volume

The additional amount of air that can be expelled from the lungs after a normal exhalation.

Vital Capacity

The maximum amount of air a person can expel from the lungs after a maximum inhalation, a measure of pulmonary health and function.