Final answer:
True, historical cost is typically used to measure many assets on the balance sheet due to its objective nature, as it indicates the original cost of an asset. It is reliable for assets like property and equipment, though fair value is used for certain assets reflecting current market conditions.
Step-by-step explanation:
True, historical cost is often used to measure many of the assets recognized on the balance sheet because of its objective nature. It refers to the original cost at which the asset was bought or acquired. The historical cost principle provides certainty and minimizes the risk of manipulation in financial reporting. For certain types of assets such as property, plant, and equipment, historical cost is considered reliable as it is based on a transaction that occurred between two parties at a specific point in time.
However, it is also important to note that not all assets are measured at historical cost. Some assets may be measured at fair value, which reflects current market conditions. Decisions on whether to measure at historical cost or fair value often depend on the type of asset and the accounting standards in place.