Which of the Following Transactions Is Consistent with Recognizing Value

question 29

Multiple Choice

Which of the following transactions is consistent with recognizing value changes on the balance sheet and income statement when they are realized in a market transaction?

• A) Selling land at a cost greater than its original purchase price.
• B) Recording an increase in the fair value of investments at year end.
• C) Translating foreign operations accounted for in Yen back to U.S.dollars in order to prepare consolidated financial statements.
• D) Writing down the value of an asset due to obsolescent.

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Definitions:

Stockout

A situation in retail or supply chain management where the inventory of a particular item is completely depleted, leading to an inability to meet customer demand.

ABC Analysis

A method for classifying inventory items based on their importance, such as their sales volume or value, to prioritize management focus.

On-Hand Inventory

The amount of inventory physically present and immediately available in a warehouse or location at any given time.

Annual Dollar Volume

The total amount of money a product or service generates in sales over the period of a year.