In Disclosing Liabilities,a Reporting Entity

question 31

Multiple Choice

In disclosing liabilities,a reporting entity:

• A) discloses on the basis of the current/non-current liability dichotomy.
• B) has a choice, based on the notions of relevance and reliability to disclose liabilities either on the basis of the current/non-current liability dichotomy or on the basis of order of liquidity.
• C) has a choice, based on the principle of conservatism to disclose liabilities either on the basis of the current/non-current liability dichotomy or on the basis of order of liquidity.
• D) discloses on the basis of order of liquidity.

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Definitions:

Directional Alternative Hypothesis

A hypothesis that specifies the direction of the expected difference or relationship between variables (e.g., greater than, less than).

Non-directional Alternative Hypothesis

A hypothesis that specifies there is a statistical difference without stating the direction of the difference.

Non-directional Null Hypothesis

A type of null hypothesis that specifies there will be no change or difference without stating a direction of change.

Standard Error

A statistical measure that quantifies the amount of variability in a sample mean compared to the population mean, used to gauge the precision of the sample mean.