Question

please complete. added photos of all 7 answer choices to choose from

Listed below are several statements that relate to financial accounting and reporting. Identify the accounting concept that applies to each statement Jim Marley is the sole owner of Marley's Appliances. Jim borrowed 1. $100.000 to buy a new home to be used as his personal residence. This liability was not recorded in the records of Marley's Appliances 2. Apple Inc. distributes an annual report to its shareholders 3 Hewlett-Packard Corporation depreciates machinery and equipment over their useful lives. Crosby Company lists land on its balance sheet at $120,000, its 4. original purchase price, even though the land has a current fair value of $200,000 Honeywell International Inc. records revenue when products are 5. delivered to customers, even though the cash has not yet been received Liquidation values are not normally reported in financial statements even though many companies do go out of business. IBM Corporation, a multibillion dollar company purchased some small tools at a cost of $800. Even though the tools will be used for a number of years, the company recorded the purchase as an expense

Answer 1

Answer is given below. one liner explanation is also given below

The Economic Entity Assumption The asset purchased for personal use cannot be recorded based on Economic entity assumption 2 The periodicity assumption Accounting is closed for each period. Hence Apple distributes the annual report 3 Expense Recognition (also the going concern assumption ) Depreciation Expense is recognised over the life of the asset The historical cost (original transaction value) principle Assets are carried at historical cost value in books 5 Revenue Recognition Revenue is recognised when goods are delivered to customers 6 The Going concern Assumption Companies are assumed to report financial statement on going concern basis Materiality The item is recorded as an expense based on materiality since the amount involved is immaterial