Which of the Following Statements Is Correct

question 52

Multiple Choice

Which of the following statements is correct?

• A) A related-party transaction is a transfer of resources, services or obligations between related parties that is not at arm's length.
• B) The existence of a related-party transaction can expose an entity to risks or opportunities that otherwise would not have existed in the absence of the relationship.
• C) Related parties include organisations that are under the control or significant influence of the entity and individuals such as key management personnel and their close family members.
• D) The existence of a related-party transaction can expose an entity to risks or opportunities that otherwise would not have existed in the absence of the relationship, and related parties include organisations that are under the control or significant influence of the entity and individuals such as key management personnel and their close family members.

---

Definitions:

Average Total Costs

The sum of all production expenses (both fixed and variable) divided by the total quantity of units created.

Per-Unit Costs

The cost associated with producing or acquiring a single unit of a product or service.

Competitive Process

The dynamic system in which businesses compete with one another for resources, customers, and market share.

Cost Advantages

Refers to the benefit a company has over its competitors in terms of lower production or operation costs.