A Client Has a Calendar Year-End

question 118

Multiple Choice

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

• A)Sale of a major subsidiary
• B)Adoption of accelerated depreciation methods
• C)Write-off of a substantial portion of inventory as obsolete
• D)Collection of 90% of the accounts receivable existing at December 31