Question

In: Accounting

Which of the following statement regarding the limitations of the statement of financial position is incorrect.


Which of the following statement regarding the limitations of the statement of financial position is incorrect. 

  • All assets and liabilities are reported at fair value. 

  • Many items that are of financial value are omitted. 

  • Judgments are used in the valuation of many items. 

  • Estimates are used in the valuation of many items.

Solutions

Expert Solution

Option A------all assets and liabilities are reported at fair value

above statement is incorrect , since Under statement of financial position, assets and liabilities are reported at historical value i.e cost at which it was acquired. for eg--- Fixed assets are recorded at historical cost

ekkarill92 answered 2 years ago
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