Solved

Match Each Item in the List with Its Descriptive Statement

Question 76

Matching

Match each item in the list with its descriptive statement by placing the appropriate letter in the space provided.

Premises:
A company records sales on account when providing a service.
A company recognizes as expense the portion of its prepaid rent that has expired.
A company reports the land that it purchased in 1990 for $500,000, at the same amount on its 2010 balance sheet.
A company reports its inventories on the balance sheet at the lower of cost or market.
An entity is preparing its five-year strategic plan.
A company amortizes its patent, an intangible asset, over its useful life.
Responses:
entity assumption
historical cost principle
going-concern assumption
conservatism convention
monetary-unit assumption
matching principle
period of time
realization
recognition

Correct Answer:

entity assumption
historical cost principle
going-concern assumption
conservatism convention
monetary-unit assumption
matching principle
period of time
realization
recognition
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