Identify the accounting concept or principle that relates to the statement in each of the following questions:
-Information should have predictive value and/or feedback value.
A) relevance
B) reliability
C) materiality
D) prudence.

Question

Identify the accounting concept or principle that relates to the statement in each of the following  questions:
-Information should have predictive value and/or feedback value.
A) relevance
B) reliability
C) materiality
D) prudence.

Quizplus · Accepted Answer

The concept of relevance in accounting ensures that information is useful and pertinent to decision making. Information with predictive value (i.e. helps predict future outcomes) and feedback value (i.e. provides feedback on past performance) is considered relevant.

Identify the Accounting Concept or Principle That Relates to the Statement