All of the Following Statements Regarding Accounting Treatments for Liabilities

question 129

Multiple Choice

All of the following statements regarding accounting treatments for liabilities under U.S.GAAP and IFRS are true except:

• A)Accounting for bonds and notes under U.S.GAAP and IFRS is similar.
• B)Both U.S.GAAP and IFRS require companies to distinguish between operating leases and capital leases.
• C)The criteria for identifying a lease as a capital lease are more general under IFRS.
• D)Both U.S.GAAP and IFRS require companies to record costs of retirement benefits as employees work and earn them.
• E)Use of the fair value option to account for bonds and notes is not acceptable under U.S.GAAP or IFRS.

---

Definitions:

Job Order Costing

An accounting method used to track costs and evaluate the expenses associated with producing specific jobs or orders.

Process Costing

An accounting methodology used to allocate costs to units of production in industries where the production process is continuous.

Cost Of Production Report

A document that details the total cost and production quantities of a specific department or process within a manufacturing operation.

First-In, First-Out

A method of valuing inventory in which the first items bought or manufactured are the first ones to be sold or utilized.