Question
Gill Construction purchases a tractor on account for $60,000. The market value of the tractor is $75,000. The company accountant then prepares the following entry
Gill Construction purchases a tractor on account for $60,000. The market value of the tractor is $75,000. The company accountant then prepares the following entry to record the purchase:
Tractor $75,000
Accounts Payable $75,000
Which of the following accounting principles does the entry violate?
a) Recognition b) Historical cost c) Materiality d) None of the above
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Essential Knowledge For A First Year Audit Staff Intern In Big 4 Accounting
Authors: Kevin Hsu
1st Edition
1481097040, 978-1481097048
