Match the letter of each principle or assumption or qualitative characteristic with the appropriate statement.
-Requires the accountant to adhere as closely as possible to verifiable data.
A)Business entity
B)Going concern
C)Time period
D)Monetary unit
E)Historical cost
F)Conservatism
G)Realization
H)Consistency
I)Full disclosure
J)Verifiability
K)Materiality
L)Industry practices

Question

Quizplus · Accepted Answer

Verifiability requires the accountant to use data that can be objectively verified or confirmed.

Answer: D
 Monetary unit assumes that financial transactions are measured in a stable and universally recognized currency.

Answer: E
 Historical cost principle states that assets should be recorded at their historical cost at the time of purchase.

Answer: F
 Conservatism requires the accountant to recognize losses or liabilities as soon as possible but only recognize gains when they are certain.

Answer: H
 Consistency requires the accountant to use the same accounting methods and principles from one period to the next.

Answer: I
 Full disclosure requires the accountant to provide all relevant information about the company's financial position.

Answer: K
 Materiality principle allows the accountant to use their professional judgment to determine if a financial event is significant enough to require disclosure.

Answer: L
 Industry practices may influence how certain financial events should be recorded or reported.

Match the Letter of Each Principle or Assumption or Qualitative