In accordance with the cost principle, the cost of debt investments includes brokerage fees and accrued interest.

Question

Quizplus · Accepted Answer

The cost principle states that assets should be recorded at their original cost, which includes all costs necessary to acquire the asset and prepare it for use. However, accrued interest is not included in the cost of debt investments; it is recorded separately as interest income or expense.

In Accordance with the Cost Principle, the Cost of Debt