Which of the Following Applies to the Measurement and Recognition

question 42

Multiple Choice

Which of the following applies to the measurement and recognition of an asset?

• A)A pervasive principle in accounting is that an asset is measured at the market value of the consideration exchanged or sacrificed to acquire it and place it in operating condition.
• B)In some cases, an asset may be recorded at an amount greater than its cash equivalent purchase price.
• C)When the consideration given for an asset is non-monetary, the market value of that consideration generally provides the most reliable basis for measuring acquisition cost.
• D)Assets are always measured and reported based on historical cost.

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Definitions:

Loosely Cemented Sand

Sand particles that are weakly bound together by a mineral matrix, which can easily erode or change shape under physical stress.

Volcanic Rock

Rock formed from magma erupted from a volcano or solidified on the surface of the earth.

American Psychiatric Association

A professional organization of psychiatrists and other mental health professionals dedicated to promoting mental health, supporting the diagnosis and treatment of mental disorders, and advancing psychiatry through education and research.

Psychological Disorders

Conditions characterized by abnormal thoughts, feelings, and behaviors that cause distress or impair functioning.