All of the Following Statements Regarding U

question 84

Multiple Choice

All of the following statements regarding U.S.GAAP and IFRS are true except:

• A)Both U.S.GAAP and IFRS include broad and similar guidance for the items and costs making up merchandise inventory.
• B)For both U.S.GAAP and IFRS,merchandise inventory includes all items that a company owns and holds for sale.
• C)Both U.S.GAAP and IFRS require companies to write down inventory when its value falls below the cost presently recorded.
• D)Both U.S.GAAP and IFRS allow reversals of write downs up to the original acquisition cost.
• E)With limited exceptions,neither U.S.GAAP nor IFRS allow inventory to be adjusted upward beyond the original cost.

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Definitions:

Extraction Companies

Firms that specialize in the removal of natural resources, such as mining or oil and gas companies, from the earth for commercial use.

Flow of Profits

The continuous movement of earnings back into a business for operational development, expansion, or distribution to shareholders.

Property Rights

Legal rights to possess, use, and dispose of assets including real estate, personal properties, and intellectual properties.

Loggers

Workers or businesses engaged in cutting down trees and transporting the logs to sawmills.