A Company Gets a Huge, One-Time Order

question 27

Multiple Choice

A company gets a huge, one-time order. It needs an additional 40 employees to complete the job but will not need them once the job is done. The best strategy is for the company to:

• A) not accept the new job
• B) use temporary employees
• C) hire and then layoff 40 employees
• D) bring former employees out of retirement

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Definitions:

Factor

A financial company that purchases receivables from businesses, providing them with immediate cash.

Impairment

Impairment is a reduction in the recoverable value of an asset below its carrying value, leading to an expense in the income statement.

Receivable

An amount of money owed to a company by its customers or clients for goods or services provided on credit.

IFRS

The International Financial Reporting Standards (IFRS) are a set of accounting standards developed by the International Accounting Standards Board (IASB) for the preparation of financial statements globally.