state which of the accounting conventions consistency full disc 250371

State which of the accounting conventions-consistency, full disclosure, materiality, conservatism, or cost-benefit-is being followed in each case described below.

1. Management provides detailed information about the company’s long-term debt in the notes to the financial statements.

2. A company does not account separately for discounts received for prompt payment of account payable because few of these transactions occur and the total amount of the discounts is small.

3. Management eliminates a weekly report on property, plant, and equipment acquisitions and disposals because no one finds it useful.

4. A company follows the policy of recognizing a loss on inventory when the market value of an item falls below its cost but does nothing if the market value rises.

5. When several accounting methods are acceptable, management chooses a single method and follows that method from year to year.

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