There Are Certain Situations Where It Is Necessary to Recast

question 137

Multiple Choice

There are certain situations where it is necessary to recast the financial statements in order to analyze them.All of the following are examples of the need to recast except:

• A)Interest on long-term debt amounted to $1,000,000.
• B)The income statement contains a number of gains not expected to occur in the future.
• C)There have been a number of temporary differences.They remain on the balance sheet.
• D)Asset purchases were made during the year.

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Definitions:

Interested Party

An individual or group that has an interest in any decision or activity of an organization, including shareholders, creditors, or employees.

Present Interest

A right to immediately use, possess, or enjoy property or income.

Testator's Property

Assets owned by an individual who has made a will, to be distributed after their death.

Per Stirpes

A distribution in which each surviving descendant divides the share that his or her parent would have taken if the parent had survived. Also called by right of representation.