In Many Cases, an Entity May Have an Implicit Obligation

question 219

Multiple Choice

In many cases, an entity may have an implicit obligation even if it is not explicitly noted in a sales contract.This is called a(n)

• A)onerous obligation.
• B)legal obligation.
• C)constructive obligation.
• D)earnings obligation.

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Definitions:

Differential Cost

The difference in total cost that will result from selecting one alternative over another in a decision-making situation.

Differential Cost

The difference in total cost that will result from selecting one choice over another.

Additional Cost

Expenses incurred that are above and beyond the initial forecast or budget for a project or product.

Differential Revenue

The difference in revenue generated under two different scenarios or as a result of a specific action.