Which of the Following Would Be a Type II Subsequent

question 90

Multiple Choice

Which of the following would be a Type II subsequent event?

• A)Information becomes available that provides evidence about the valuation of an estimate or reserve that had been accrued at year end.
• B)A sale of inventory below carrying value provides evidence that the net realizable value was less than cost at year end.
• C)A stock dividend or split that takes place during the subsequent period should be disclosed.In addition,earnings-per- share figures should be adjusted to show the retroactive effect of the stock dividend or split.
• D)A material change occurs in the value of investment securities after the balance sheet date.

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Definitions:

Small Business Loan

Financing specifically targeted to support the needs and growth of small and medium-sized enterprises, often provided with favorable terms.

Goods-In-Bailment

Items that are temporarily entrusted to another party (the bailee) for a specified purpose, under a bailment agreement, but ownership remains with the person who entrusts the goods (the bailor).

Negotiable Document

A document guaranteeing the payment of a specific amount of money, either on demand or at a set time, that can be transferred to another holder.

Nonnegotiable Document

A document that cannot be transferred or assigned to another party in a way that confers the original holder's rights to the recipient.