ACCOUNTING PRINCIPLES Four statements are given below.

a. A company recognizes revenue when the goods are delivered to a customer, even though cash will not be collected from the customer for 30 days.

b. Land, located in a desirable location, is reported at the original acquisition price, even though its value has increased by over 100 percent since it was purchased.

c. The cost paid for a delivery truck is recorded as an asset and expensed over the next five years as it is used to help generate revenue.

d. Inventory, which was recently damaged by a flood, is reported at the lower of its cost or market value.

Required:

Give the accounting principle that is most applicable to each of the following statements.

Cornerstone Exercise