Which of the Following Is Not a Proper Use of Notes

question 66

Multiple Choice

Which of the following is not a proper use of notes?

• A)To describe the nature and effect of a change in accounting principle,such as from FIFO to LIFO.
• B)To indicate the basis for asset valuation.
• C)To indicate the method of depreciation.
• D)To correct an improper financial statement presentation.
• E)To describe a firm's debt.

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Definitions:

Financial Liability

An obligation to transfer cash or other resources as a result of past transactions or events.

Contractual Obligation

A contractual obligation is a duty or responsibility that one party is legally bound to perform under a contract agreement with another party.

Cash Consideration

Payment made in cash during a transaction, as opposed to stock exchange or other non-cash assets.

Amortised Cost

A financial valuation technique that gradually writes off the initial cost of an asset over a period, or the method of allocating the cost of an intangible asset over its useful life.