Which Is Not a Characteristic of a Liability

question 98

Multiple Choice

Which is not a characteristic of a liability?

• A)There will be a probable future transfer or use of assets.
• B)There is little or no discretion to avoid the future sacrifice.
• C)The obligating transaction or event must have already happened.
• D)A legally enforceable claim must be present.

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Definitions:

Dividends

Payments made by a corporation to its shareholder members, usually derived from profits.

Management Fees

Charges levied by management for the operation of an investment fund, company, or another entity, usually calculated as a percentage of assets under management.

Consolidated Retained Earnings

The portion of net earnings not paid out as dividends, but retained by the company to reinvest in its core business, or to pay debt, reported in the consolidated financial statements.

Subsidiary's Adjusted Income

The net income of a subsidiary company after making adjustments for fair value measurements, currency translation, and other accounting policies.