How does an accountant decide on the appropriate method of accounting for a business transaction?
A)Evaluating if the particular method is consistent with the conceptual framework.
B)Ensuring that the accounting method agrees with that selected by other companies.
C)Evaluating whether the selected method differs from the underlying economics.
D)Testing the selected method for numerical accuracy and consistency.

Question

Quizplus · Accepted Answer

The appropriate method of accounting for a business transaction should be consistent with the conceptual framework of accounting. This means that the method should follow the principles and guidelines set forth by accounting standards and provide relevant and reliable financial information to stakeholders.

How Does an Accountant Decide on the Appropriate Method of Accounting