Which of the Following Is True of Expense Classification Under

question 129

Multiple Choice

Which of the following is true of expense classification under IFRS?

• A) The nature-of-expense method identifies the major cost drivers of the company.
• B) The nature-of-expense method does not classify the expenses into various subtotals.
• C) The function-of-expense method is simple to apply because allocations of expense to different functions are not necessary.
• D) IFRS allows only function-of-expense method for expense classification.

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Definitions:

Interest Earned

The amount of money gained as interest from savings, investments, or loans, over a specific period.

Account

A record or statement showing the financial transactions and status of an individual or entity with a financial institution.

Days

Units of time equal to 24 hours, used as a measurement of the duration of events or the interval between them.

Term Deposit

A bank deposit with a fixed term and usually a higher interest rate than a savings account, requiring funds to remain deposited for a specific period.