The Key Difference Between Provisions and Liabilities Is

question 34

Multiple Choice

The key difference between provisions and liabilities is:

• A) the party that the obligation is owed to.
• B) whether the obligation is current or non-current.
• C) the uncertainty regarding the amount or timing of the future sacrifice of economic resources.
• D) whether there is an obligation.

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Definitions:

Direct Labor-Hours

The amount of time spent by workers directly involved in manufacturing a product or delivering a service.

Raw Materials

The basic substances in their natural, modified, or semi-processed states used as inputs for manufacturing processes.

Selling and Administrative Expense

Costs related to the selling of products and the administration of a business.

Budgeted Unit Sales

The projected amount of sales in units that a company plans to achieve in a specific period.