Which of the Following Material After-Reporting-Date Events Is a Non-Adjusting

question 66

Multiple Choice

Which of the following material after-reporting-date events is a non-adjusting event?

• A) major disposal of assets before the reporting date
• B) expropriation of assets by government before the reporting date
• C) issue of preference shares shortly after the reporting date
• D) settlement before authorisation date of the financial report of a lawsuit filed by a customer three years ago

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Definitions:

Cash Dividends

Profits distributed by a company to its shareholders out of the company's current or retained earnings, typically in the form of cash.

Preferred Stock

A class of ownership in a corporation with a specified dividend that is paid before any dividends are paid to common stock holders and typically with no voting rights.

Common Stock

Type of security that signifies ownership in a corporation and represents a claim on part of the company's profits and assets.

Dividends

Disbursements issued by a company to its shareholders, representing a share of the company's earnings distributed to its stockholders.