Which of the Following Is an Example of a Financial

question 181

Multiple Choice

Which of the following is an example of a financial transaction?

• A) A firm purchases a fire insurance policy.
• B) An internal auditor discovers an error in a firm's inventory valuation.
• C) A potential customer accesses a firm's web page.
• D) A manager reviews the financial statements prepared by an accountant.

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Definitions:

IFRS

International Financial Reporting Standards, a set of accounting standards globally accepted for financial reporting.

Standard of Care

The level of care and caution expected from someone who has a responsibility to act carefully.

Distributor's Liability

Legal accountability faced by distributors for selling or distributing defective products that cause harm or loss to the purchasers.

Manufacturer's Negligence

Occurs when a manufacturer fails to meet a duty of care owed, leading to a defective product that causes harm.