When a standard restricts the number of accounting methods to be used to account for a particular accounting issue,it is promoting the qualitative characteristic of ______________?
A)Timeliness
B)Prudence
C)Understandability
D)Comparability
E)Relevance

Question

Quizplus · Accepted Answer

When a standard restricts the number of accounting methods to be used to account for a particular accounting issue, it is promoting the qualitative characteristic of comparability.
Comparability is a qualitative characteristic that enables users to identify and understand similarities in, and differences among, items. When accounting standards limit the methods available for accounting for certain transactions or events, it helps ensure that different entities are accounting for these items in a similar way, making their financial statements more comparable. This comparability allows users, such as investors and creditors, to make more informed decisions by comparing financial information across different companies.

When a Standard Restricts the Number of Accounting Methods to Be