The Occurrence Which Most Likely Would Have No Effect on 2011

question 30

Multiple Choice

The occurrence which most likely would have no effect on 2011 net income (assuming that all amounts involved are material) is the

• A)sale in 2011 of an office building contributed by a stockholder in 1987.
• B)collection in 2011 of a receivable from a customer whose account was written off in 2010 by a charge to the allowance account.
• C)settlement based on litigation in 2011 of previously unrecognized damages from a serious accident which occurred in 2008.
• D)worthlessness determined in 2011 of stock purchased on a speculative basis in 2007.

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Definitions:

Medial Temporal Lobes

A critical region of the brain involved in the formation of new memories, spatial navigation, and the integration of sensory information.

Sensation

The process by which sensory receptors and the nervous system receive and represent stimuli from the environment.

Perception

The process of organizing and interpreting sensory information, enabling us to recognize meaningful objects and events.

Detection

The act or process of discovering or identifying the presence of a specific substance, condition, or characteristic.