Which of the following statements is incorrect?
A)Under GAAP, statements are prepared using accrual accounting.
B)Under GAAP, all assets are marked to market each accounting period.
C)Under GAAP, it is necessary to make certain estimates.
D)Annual statements submitted to the SEC (10-K) must be prepared using GAAP.

Question

Quizplus · Accepted Answer

Under GAAP, not all assets are marked to market each accounting period. Only certain assets such as marketable securities and derivatives are marked to market. Other assets such as property, plant, and equipment are recorded at historical cost and then depreciated over their useful lives.

Which of the Following Statements Is Incorrect