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Which GAAP principle tells us how to record assets?

Which GAAP principle tells us how to record assets?
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Answer #1

The Cost Principle

The value recorded in the accounts for an asset is not changed until later if the market value of the asset changes. It would take an entirely new transaction based on new objective evidence to change the original value of an asset.

There are times when the above type of objective evidence is not available. For example, a building could be received as a gift. In such a case, the transaction would be recorded at fair market value which must be determined by some independent means.

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