Accounting information is considered to be relevant when it
A)Is capable of making a difference in a decision.
B)Is understandable by reasonably informed users of accounting information.
C)Can be depended on to represent the economic conditions and events that it is intended to represent.
D)Is verifiable and neutral.
E)Is free from bias.

Question

Quizplus · Accepted Answer

Relevant accounting information is capable of making a difference in a decision. It must be able to influence the decision-making process of users by providing useful insights into the economic conditions and events that it is intended to represent. While understandability, dependability, verifiability, neutrality, and freedom from bias are also important qualities of accounting information, they relate to its reliability rather than its relevance.

Accounting Information Is Considered to Be Relevant When It