According to AASB 101, a Required Format for the Presentation

question 14

Multiple Choice

According to AASB 101, a required format for the presentation of the statement of profit or loss and other comprehensive income is:

• A) prescribed by the standard.
• B) not prescribed but guidance is provided in the standard for a suitable format.
• C) not prescribed and no guidance is provided in the standard for a suitable format.
• D) prescribed by the standard and further details are found in the Corporations Act.

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Definitions:

Long-run Profits

Earnings achieved over an extended period, where all inputs can be adjusted by firms, reflecting the company's ability to adapt and reoptimize operations.

Perfectly Competitive

A market structure characterized by many buyers and sellers, homogeneous products, free entry and exit, and perfect information.

Efficient

The optimal allocation and utilization of resources to achieve the best possible outcome or output.

Excess Capacity

Excess capacity occurs when a firm's actual production is less than its maximum possible output, often indicating underutilized resources or insufficient demand.