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IIA Exam IIA-CIA-Part3 Topic 2 Question 80 Discussion

Actual exam question for IIA's IIA-CIA-Part3 exam
Question #: 80
Topic #: 2
[All IIA-CIA-Part3 Questions]

Which of following best demonstrates the application of the cost principle?

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Suggested Answer: C

by Elvera at Jun 02, 2024, 07:35 AM

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Yolando
3 months ago
Hey, you know what they say - the only thing constant in accounting is change. Unless it's the cost principle, of course!
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Tiffiny
2 months ago
C) A building purchased last year for 1 million is currently worth 1,2 million , and the company adjusts the records to reflect the current value
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Suzi
2 months ago
B) A building purchased last year for $1 million is currently worth 1.2 million, but the company still reports the building at $1 million.
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Kyoko
2 months ago
A) A company reports trading and investment securities at their market cost
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Ilene
3 months ago
D is an interesting choice, but it goes against the whole point of the cost principle. B is the way to go, my friend.
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Sheron
3 months ago
Hmm, C looks tempting, but the cost principle is clear - historical cost is the way to go. B is the winner!
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Shelia
3 months ago
Ah, the classic cost principle dilemma. B seems like the obvious choice here. Gotta love those accounting rules!
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Hoa
2 months ago
Celestine: That's a good point, but I still think sticking to the original cost is the best way to follow the cost principle.
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Monroe
2 months ago
User 3: But what about option C? Shouldn't the company adjust the records to reflect the current value?
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Celestine
2 months ago
User 2: Yeah, I agree. It's important to report the building at its original cost.
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Chi
3 months ago
User 1: I think B is the best choice. It shows the application of the cost principle.
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Glory
3 months ago
B is the correct answer. The cost principle states that assets should be recorded at their historical cost, not their current market value.
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Marshall
4 months ago
But doesn't the cost principle state that assets should be recorded at their original cost?
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Alishia
4 months ago
I disagree, I believe the answer is C.
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Marshall
4 months ago
I think the answer is B.
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