Question
A company purchased land in 2010 for ₹10 lakh. In
2025, its market value rose to ₹60 lakh. However, the company continues to record it at ₹10 lakh. Which accounting principle justifies this treatment?Solution
Assets are recorded at the original purchase price, not market value, based on the historical cost concept. Unrealized gains are not recognized unless realized through sale.
More Accounts Questions
- Select the number from among the given options that can replace the question mark (?) in the following series.
17, 18, 22, 31, 47, ___ - Which letter-cluster will replace the question mark (?) in the following series?
RGV, UME, ?, AYW, DEF - A series is given with one term missing. Choose the correct alternatives from the given ones that will complete the series.
57, 59, 56, 61, 54, ___ - Which letter-cluster will replace the question mark (?) in the following series?
NPQR, OORQ, PNSP, ____, RLUN - Which letter and number cluster will replace the question mark (?) to complete the given series?
LT6, KU12, IW24, FZ48, ____
