What nick accountant has challenged

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Nick Mortimer is the major shareholder of the scuba-diving business Adventure Down-Under Pty Ltd. Adventure Down-Under Pty Ltd purchased a new dive compressor on 1 June 2019 from CIG Compressors for $8,000. The company reported the compressor for $8,000 in the Balance Sheet. Due to wear and tear Nick now believes the compressor to be worth a market value of $5,500 on 30 June 2020.

  • Nick has instructed his bookkeeper to change the value of the compressor to $5,500 to reflect the market value on 30 June 2020.

Problem 1: Nick's accountant has challenged that decision stating a change in the value of the compressor on 30 June 2020 would be breaching the

Group of answer choices

Option 1: Accounting assumption - Historical Cost

Option 2: Qualitative characteristic - Historical Cost

Option 3: Qualitative characteristic - Verifiability

Option 4: Accounting assumption - Relevance

Option 5: Accounting assumption - Timeliness

Reference no: EM132864663

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