The cost principle requires that when assets are acquired, they be recorded at
cost
their historical cost.
To find the answer to your question, you can refer to accounting principles and concepts. The cost principle is fundamental in accounting and states that assets should be initially recorded on a company's balance sheet at their historical cost. Historical cost refers to the actual amount paid or the fair value of an asset at the time it was acquired.
The purpose of the cost principle is to provide a reliable and objective basis for evaluating and reporting an entity's financial position. By recording assets at their historical cost, it avoids subjective valuations and provides a more accurate reflection of the economic resources utilized by the company.
To summarize, according to the cost principle, when assets are acquired, they should be recorded at their historical cost. This requirement ensures consistency and reliability in financial reporting.