According to the Existing IFRS and the CICA Handbook Part

question 12

Multiple Choice

According to the existing IFRS and the CICA Handbook Part II guidelines, which of the following is NOT an essential characteristic of a liability?

• A)It embodies a duty or responsibility.
• B)The transaction or event that obliges the entity has occurred.
• C)The obligation is enforceable on the obligor entity.
• D)The entity has little or no discretion to avoid the duty.

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Definitions:

Capital Balances

The amounts recorded in the equity section of a company's balance sheet, representing the funds contributed by owners plus retained earnings.

Balance Sheet

A financial statement summarizing a company's assets, liabilities, and shareholders' equity at a particular point in time.

Bonus Method

An accounting technique used to record the transactions related to the admission of a new partner into a partnership by revaluing the existing partners' capital accounts.

Profits and Losses

A financial statement that summarizes the revenues, costs, and expenses incurred during a specified period, usually a fiscal quarter or year.