When an $30 asset with a six-year estimated useful life is recorded as an expense at the date of purchase, this is an application of the:
A) matching principle.
B) cost principle.
C) unit-of-measure assumption.
D) materiality constraint.
E) None of these answers are correct.

Question

Quizplus · Accepted Answer

The materiality constraint allows companies to expense small amounts immediately if they are not significant enough to affect financial statements, which applies to the $30 asset.

When an $30 Asset with a Six-Year Estimated Useful Life