The accounting principle that requires important noncash financing and investing activities be reported on the statement of cash flows or in a footnote is the:
A) Materiality principle.
B) Historical cost principle.
C) Business entity principle.
D) Full disclosure principle.
E) Going concern principle.

Question

Quizplus · Accepted Answer

The Full Disclosure principle requires that all important information be reported in financial statements. This includes noncash financing and investing activities, which must be disclosed either on the statement of cash flows or in footnotes to the financial statements.

The Accounting Principle That Requires Important Noncash Financing and Investing