Question

Assets should always be carried at their original or historical cost. True False

Assets should always be carried at their original or historical cost.

True

False

Business   Accounting   
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Answer #1

Answer

FALSE

Explanation:

As per Cost concept, most assets are recorded at their original or historical cost. This is done even if the market value of assets differs from the cost.

But not all assets are recorded at their original or historical cost. Assets such as marketable securities and other current assets are recorded at their fair value.

The assets are carried at their book value. Book value is calculated as ' Cost less depreciation'.

So, Assets are not carried at their original or historical cost.

In case of any doubt or clarification, you're welcome to come back via comments.

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