If a Reasonable Estimate of Potential Refunds Cannot Be Made

question 27

Multiple Choice

If a reasonable estimate of potential refunds cannot be made, _______.

• A)the firm should simply disregard any expense and handle on a case-by-case basis
• B)revenue should not be recognized until the material uncertainty is resolved
• C)a portion of the revenue should recognized immediately upon sale
• D)no revenue recognition should occur during the life of the refund obligation

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Definitions:

Nonverbal Communication

Nonverbal communication involves the transmission of messages or information through facial expressions, body language, gestures, eye contact, and other non-linguistic means.

Eye Contact

The act of looking directly into another person's eyes, which can convey attention, confidence, or other emotions.

Oral

Pertaining to the mouth, or in the context of communication, referring to spoken rather than written word.

Communication Barrier

Any obstacle that impedes the transfer of clear and effective messages between sender and receiver, potentially leading to misunderstandings.