Which of the Following Material Events Occurring Subsequent to the Balance

question 12

Multiple Choice

Which of the following material events occurring subsequent to the balance sheet date would require an adjustment to the financial statements before they could be issued?

• A)Sale of long-term debt or capital stock.
• B)Loss of a plant as a result of a flood.
• C)Major purchase of a business which is expected to double the sales volume.
• D)Settlement of litigation in excess of the recorded liability.