Against Which of the Following Possibilities Should a High Probability

question 62

Multiple Choice

Against which of the following possibilities should a high probability that a particular loss-causing event will occur be weighed during the risk evaluation process?

• A) that the event will definitely occur and the loss is unavoidable
• B) whether the likely occurrence may be offset by a low level of associated loss
• C) whether a low probability will be offset by a high level of associated loss
• D) that the event will likely never occur and should be ignored

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Definitions:

Purchases Returns

Goods returned to the supplier from the buyer due to defects, inaccuracies in orders, or other reasons.

Sales Returns

Transactions where customers return previously purchased merchandise to the seller, resulting in a deduction from gross sales to arrive at net sales.

Purchases Returns

Goods returned by a buyer to the seller, often due to defects or dissatisfaction, resulting in a refund or credit.

Purchase Discounts

Discounts a buyer receives for paying suppliers early, which are used to reduce the cost of purchased goods.