Which of the Following Should Be Disclosed in a Summary

question 30

Multiple Choice

Which of the following should be disclosed in a Summary of Significant Accounting Policies?

• A) Types of executory contracts
• B) Amount for cumulative effect of change in accounting principle
• C) Claims of equity holders
• D) Depreciation method followed

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Definitions:

Source Document

A piece of evidence, such as an invoice or receipt, that records a financial transaction.

Manufacturing Overhead-Applied

Indirect costs related to manufacturing that are assigned to products based on a predetermined rate.

Overhead Applied Rate

A rate calculated to allocate indirect costs to cost objects based on a predetermined formula.

Direct Labor Hours

The total time workers or employees spend directly working on goods or services that are being produced.