The historical cost principle requires that when assets are acquired they are recorded at

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The historical cost principle dictates that assets are to be recorded at their cost, or the amount paid to acquire them. This is the most objective and verifiable method of recording the value of an asset, as opposed to appraised value or list price which may be subjective and open to interpretation. Book value may also not reflect the true value of an asset, especially if there has been significant depreciation over time.

The Historical Cost Principle Requires That When Assets Are Acquired