Which of the Following Statements Is True

question 232

Multiple Choice

Which of the following statements is true?

• A) The FASB and IASB would like to reduce the reliance on fair value accounting for financial instruments in the future.
• B) The fair value option allows, but does not require, that some types of financial instruments be recorded at fair value.
• C) The fair value option requires that some types of financial instruments be recorded at amortized cost.
• D) The fair value option requires that some types of financial instruments be recorded at fair value.

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Definitions:

Marginal Cost

The financial implication of creating an extra unit of a product or service.

Fixed Cost

Costs that do not change with the level of output or production, such as rent or salaries.

Profits

The financial gain realized when the revenue from selling goods or services exceeds the costs, taxes, and expenses involved in its provision.

Efficient Solution

An outcome in which resources are allocated in the most effective manner, maximizing utility or benefit without waste.