Hierarchy of Accounting Qualities: Pervasive Constraints | CFA Level 1 Exam Preparation

Pervasive Constraints

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According to the hierarchy of accounting qualities, which of the following is considered a pervasive constraint?

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A. B. C. D. E.

B

All accounting information is subject to two quantitative constraints: materiality and cost/benefit. The constraint of benefit/cost states that the benefits of information must exceed the cost of obtaining it.