State the accounting assumption, principle, information characteristic or constraint that is most applicable:
1. An officer of Nanuck Inc. purchased a new home computer for personal use with company money, charging miscellaneous expense.

2. A machine, which cost $60,000, is reported at its current market value of $90,000.

3. Nanuck Inc. decides to establish a large loss and related liability this year because of the possibility that it may lose a pending patent infringement lawsuit. The possibility of loss is considered remote by its lawyers.

4. Because the company's income is low this year, a switch from accelerated depreciation to straight-line depreciation is made this year.
5. The president of Nanuck Inc. believes it is foolish to report financial information on a yearly basis. Instead, the president believes that financial information should be disclosed only when significant new information is available related to the company's operations.

Question

State the accounting assumption, principle, information characteristic or constraint that is most applicable:
1. An officer of Nanuck Inc. purchased a new home computer for personal use with company money, charging miscellaneous expense.

2. A machine, which cost $60,000, is reported at its current market value of $90,000.

3. Nanuck Inc. decides to establish a large loss and related liability this year because of the possibility that it may lose a pending patent infringement lawsuit. The possibility of loss is considered remote by its lawyers.

4. Because the company's income is low this year, a switch from accelerated depreciation to straight-line depreciation is made this year. 
5. The president of Nanuck Inc. believes it is foolish to report financial information on a yearly basis. Instead, the president believes that financial information should be disclosed only when significant new information is available related to the company's operations.

Quizplus · Accepted Answer

The Answer of State the accounting assumption, principle, information characteristic or constraint that is most applicable:
1. An officer of Nanuck Inc. purchased a new home computer for personal use with company money, charging miscellaneous expense.

2. A machine, which cost $60,000, is reported at its current market value of $90,000.

3. Nanuck Inc. decides to establish a large loss and related liability this year because of the possibility that it may lose a pending patent infringement lawsuit. The possibility of loss is considered remote by its lawyers.

4. Because the company's income is low this year, a switch from accelerated depreciation to straight-line depreciation is made this year. 
5. The president of Nanuck Inc. believes it is foolish to report financial information on a yearly basis. Instead, the president believes that financial information should be disclosed only when significant new information is available related to the company's operations.

State the Accounting Assumption, Principle, Information Characteristic or Constraint That