Two Hundred Members of a Certain Ski Club Paid $3,000

question 31

Multiple Choice

Two hundred members of a certain ski club paid $3,000 each for a European ski trip. The company that sponsored the trip went out of business without providing the trip and without returning the club members' deposits. What type of action best suits this circumstance?

• A) A class action
• B) A small claims action
• C) A negligence action
• D) An independent contract's action

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Definitions:

MACRS Depreciation

The Modified Accelerated Cost Recovery System, a method of depreciation in the U.S. that allows for faster depreciation of assets over time for tax purposes.

Temporary Differences

The differences between the accounting income and taxable income that are not permanent and will reverse in future periods.

Permanent Differences

These are variations between taxable income and accounting income that originate from certain items being recognized in one manner for tax purposes and another for financial reporting purposes and do not reverse over time.

Pretax Financial Accounting

The process of preparing financial statements that calculate revenues, expenses, and earnings before taxes are deducted.