Which of the Following Events Would Be Considered an Extraordinary

question 46

Multiple Choice

Which of the following events would be considered an extraordinary item?

• A) An airline experienced a significant loss due to a strike by employees of the company who provide its aircraft maintenance.
• B) A food cannery was faced with a large loss of inventory of canned soups due to government condemnation because of possible botulism contamination; the company had never experienced a similar situation in its history.
• C) A company, located on an island which has experienced severe flooding three times in the past 25 years, was subjected to a heavy loss of physical plant due to flooding.
• D) A medical corporation was required to pay a patient damages equal to three times its average net income. The corporation had experienced suits of this nature in the past, but the amount of the losses had never exceeded 5 percent of the corporation's average net income.