On a Balance Sheet, What Is the Preferable Presentation of Notes

question 21

Multiple Choice

On a balance sheet, what is the preferable presentation of notes or accounts receivable from officers, employees, or affiliated companies?

• A) As trade notes and accounts receivable if they otherwise qualify as current assets
• B) As assets but separately from other receivables
• C) As offsets to capital
• D) By means of notes or footnotes

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Definitions:

Persuasive Authority

Persuasive authority refers to legal sources, such as case law from other jurisdictions, that a court may consider but is not obligated to follow in its decision-making.

Rules of Construction

Legal principles that guide judges in interpreting statutes, contracts, or documents.

Statutory Interpretation

The process by which courts analyze and apply legislation to resolve disputes and interpret the law.

Administrative Regulations

Rules or directives issued by government agencies that have the force of law, governing the implementation of specific public policies.