The Conservatism Principle

question 180

Multiple Choice

The conservatism principle:

• A)Requires that when there are more than one equally likely estimate of amounts expected to be received or paid in the future,then the less optimistic amount should be used
• B)Requires that a company use the same accounting methods period after period
• C)Requires that revenues and expenses be reported in the period in which they are earned or incurred
• D)Requires that all items of a material nature be included in financial statements
• E)Requires that all inventory items be reported at full cost

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Definitions:

Organic Solidarity

A concept introduced by Émile Durkheim, denoting a type of social cohesion that arises when people in a society perform a wide variety of specialized functions, depending on each other for survival.

Academic Dishonesty

A breach of academic integrity that involves cheating, plagiarism, or other forms of misrepresentation or fabrication in an academic setting.

Functional Imperatives

Essential tasks that an institution, organization, or system must perform to maintain stability and continue to exist.

Parsons

Talcott Parsons, an influential American sociologist known for his work on the theory of social action and for developing structural functionalism.