PRC-1 · Chapter 6 · Question 74 of 100
Which of the following principles dictates that an asset is recorded at the amount of cash paid or the fair value of consideration given at the exact time of its acquisition?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Historical Cost Concept
Explanation
The historical cost concept requires that assets are initially recorded in the books at their original purchase price (historical cost) rather than their current market value.
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