A business decides to expense the cost of minor repair tools rather than capitalise them.This is an example of which principle?

Question

Quizplus · Accepted Answer

The principle of materiality states that the significance of an item should be considered when making accounting decisions. In this case, expensing minor repair tools instead of capitalizing them is likely not material enough to impact the financial statements, so it is more practical to expense them.

A Business Decides to Expense the Cost of Minor Repair