The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the cash or cash-equivalent amount given in exchange, is the:A) Going-concern assumption. B) Realization principle. C) Business entity assumption. D) Accounting equation. E) Measurement (Cost) principle.

Question

Nick Edwards

Business

30 November, 14:03

The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the cash or cash-equivalent amount given in exchange, is the:A) Going-concern assumption. B) Realization principle. C) Business entity assumption. D) Accounting equation. E) Measurement (Cost) principle.

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Answers (1)

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Scott Dunn · Answer 1

Answer: (E) Measurement (Cost) principle

Explanation:

The cost or the measurement principle is one of the type of accounting concept that basically used for recording the overall transaction and it also required the financial statements over the period of time.

The cost principle is also called as historical cost principle as it recording the cash amount of the assets in an organization.

According to the given question, the measurement (Cost) principle is refers to the accounting principle that basically require the overall information based on the actual cost that is recorded initially at the cash exchange method.

Therefore, Option (E) is correct answer.