Which Statement Is Not Correct About Commitments

question 50

Multiple Choice

Which statement is not correct about commitments?

• A)A commitment to buy equipment must be disclosed if the contract is partially executed.
• B)A commitment to buy equipment must be disclosed even if the contract is unexecuted.
• C)Onerous contracts must be disclosed if they can be reliably measured.
• D)Onerous contract must be recognized in the accounting records.

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Definitions:

Managerial Accounting

The field of accounting that focuses on providing information to managers for use in planning, controlling, and making decisions.

Service Entities

Organizations that primarily provide intangible products or services to customers or other businesses.

Manufacturing Entities

Businesses involved in the production of physical goods from raw materials through a systematic process of transformation.

Function Of Controlling

The managerial process of monitoring organizational performance against goals and objectives and making adjustments as needed.