A Client Has a Calendar Year-End

question 42

Multiple Choice

A client has a calendar year-end.Listed below are four events that occurred after December 31.Which of these subsequent events might result in adjustment of the December 31 financial statements?

• A)adoption of accelerated depreciation methods
• B)write-off of a substantial portion of inventory as obsolete
• C)collection of 90% of the accounts receivable existing at December 31
• D)sale of a major subsidiary

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Definitions:

Methanol

CH3OH, a fundamental alcohol, is employed across various uses including as a solvent, antifreeze, fuel, and as an initial substance for the creation of additional chemical products.

Fuel Source

A material or substance that can be consumed to produce energy.

Acid-Base Reaction

A chemical reaction that involves the transfer of a proton (H+) from an acid to a base, resulting in the formation of a conjugate base and a conjugate acid.

Equilibrium

The state in which the concentrations of reactants and products in a reversible chemical reaction are unchanged over time, indicating a balance in the rate of forward and reverse reactions.