As per the Cost Concept, the transaction are recorded at its Acquisition Cost, Market value, Intrinsic value, or Face value?
Understand the Problem
The question is a part of an accountancy exam paper and consists of multiple choice questions related to basic accounting principles, asset classification, and transactions.
Answer
Acquisition Cost
The final answer is Acquisition Cost.
Answer for screen readers
The final answer is Acquisition Cost.
More Information
The cost concept in accounting states that assets are recorded at their acquisition cost, which is the amount paid to acquire them, rather than their market value, intrinsic value, or face value.
Tips
A common mistake is confusing intrinsic value or market value with acquisition cost. Remember, acquisition cost refers to the actual cost incurred to buy the asset.
Sources
- What Is an Acquisition Cost in Business Accounting? - Investopedia - investopedia.com
- Are assets recorded at cost or market value? - Quora - quora.com
- Historical Cost - Overview, Example, Accounting Adjustment - corporatefinanceinstitute.com
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