This concept, which is an extension of the going-concern concept, holds that the value of an asset that a company reports in its accounting records should be the asset's historical cost, not its current market value. Although this concept offers objectivity and reliability, it may lack relevance, particularly for assets held for a long period of time. From the following answer choices, choose the name of the accounting concept that matches the description.

Question

Quizplus · Accepted Answer

The cost concept states that assets should be recorded at their historical cost, not their current market value. This offers objectivity and reliability, but may lack relevance for assets held for a long period of time.

This Concept, Which Is an Extension of the Going-Concern Concept