Which of the Following Indicators Is Not an Example of an Event

question 50

Multiple Choice

Which of the following indicators is not an example of an event that casts doubts on the going concern status of the business?

• A) A court decision with material damages against the business;
• B) Resignation of an employee.
• C) Recoverability of trade receivables during a recession;
• D) Denial of a significant credit line;
• E) Loss of a major market.

---

Definitions:

Income Statement

A financial statement that shows a company’s revenues and expenses over a specific period, highlighting net profit or loss.

Merchandiser

A business entity engaged in selling goods directly to consumers or other businesses.

Cost Flow

The manner in which costs move through a firm, from initial acquisition of raw materials to final sale of finished goods.

Single-Step Income Statement

An income statement format that lists all revenues and then deducts all expenses to find the net income with only one subtraction.