Recording asset impairments is based on the concept of

Question

Recording asset impairments	is based on the concept of

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Recording asset impairments is based on the concept of conservatism. This accounting principle requires accountants to anticipate and recognize losses, but not gains. When an asset's carrying amount exceeds its recoverable amount, an impairment loss is recognized to reflect the asset's reduced value, aligning with the conservatism principle to ensure financial statements do not overstate the financial position or performance of an entity.

Recording Asset Impairments Is Based on the Concept of