Businesses are often described by the type or nature of business activity they engage in.The business The Home Depot is what type of business?O ManufacturingO ServiceO Merchandising An owner of a business found a great deal and pays $5,000 for a truck to be used in thebusiness. The owner estimates that the truck had a market value of $8,000, and decides torecord the new asset for $8,000 in the books of the business. What principle or concept ofGAAP has the owner violated in recording the truck at the value of $8,000?O The Cost ConceptO The Objectivity ConceptThe Unit of Measure ConceptO The Matching Concept

Answered: An owner of a business found a great…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Businesses are often described by the type or nature of business activity they engage in.
The business The Home Depot is what type of business?
O Manufacturing
O Service
O Merchandising

An owner of a business found a great deal and pays $5,000 for a truck to be used in the
business. The owner estimates that the truck had a market value of $8,000, and decides to
record the new asset for $8,000 in the books of the business. What principle or concept of
GAAP has the owner violated in recording the truck at the value of $8,000?
O The Cost Concept
O The Objectivity Concept
The Unit of Measure Concept
O The Matching Concept

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According to the given question, we are required to find the correct answer from the available options.

Generally accepted accounting principles (GAAP):

GAAP refers to the collection of accounting concepts, standards, and rules that are commonly followed by all companies for reporting their financial statements. It is a uniform principle of accounting that recognizes globally.

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