Valuing assets at their liquidation values rather than their cost is inconsistent with the
A) periodicity assumption.
B) expense recognition principle.
C) materiality equality.
D) historical cost principle.

Question

Quizplus · Accepted Answer

Valuing assets at their liquidation values goes against the historical cost principle, which states that assets should be recorded at their original cost. The principle requires that assets be recorded at the amount paid for them at the time of purchase. This method provides a conservative basis for the valuation of assets.

Valuing Assets at Their Liquidation Values Rather Than Their Cost