Under current GAAP, inflation is ignored in accounting due to the
A) economic entity assumption.
B) going concern assumption.
C) monetary unit assumption.
D) periodicity assumption.

Question

Quizplus · Accepted Answer

GAAP, or generally accepted accounting principles, follows the monetary unit assumption which assumes that the currency used in financial reporting is stable and consistent over time. In other words, GAAP does not take into consideration the impact of inflation on financial reporting.

Under Current GAAP, Inflation Is Ignored in Accounting Due to the