Recording Land at Its Cost Rather Than Its Appraisal Value

question 50

Multiple Choice

Recording land at its cost rather than its appraisal value illustrates

• A) the full disclosure principle.
• B) the cost basis principle.
• C) the realization principle.
• D) the matching principle.

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Definitions:

Planning

The process of setting objectives and determining the actions necessary to achieve them.

Product Cost

The total cost associated with making a product, including direct labor, materials, and manufacturing overhead.

Period Cost

Expenses that are incurred by a business during a specific period but are not directly tied to the production process, such as administrative and selling expenses.

Property Taxes

Taxes paid by property owners to local or state authorities based on the assessed value of their property.