The Standards for Private Entity GAAP and IFRS Include Numerous

question 18

Multiple Choice

The standards for private entity GAAP and IFRS include numerous differences.Which of the following statements best describes the requirements for the preparation and presentation of the cash flow statement?

• A)Both standards allow the use of the indirect or direct method
• B)Private entity GAAP permits the use of the direct method only
• C)IFRS permits the use of the single-step method only
• D)(b) and (c)

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Definitions:

Opportunity Cost

Refers to the benefits one foregoes by choosing one option over another, highlighting the trade-offs inherent in decision-making processes.

Bushel

A unit of volume that is used in the United States for measures of agricultural produce, such as grains, fruits, and vegetables.

Exchange Rate

The price of one country's currency in terms of another currency, determining how much foreign currency can be bought with a unit of the domestic currency or vice versa.

Cognac

A type of brandy named after the town of Cognac in France, known for its strict production methods and aging process.