In a Constructive Obligation Where the Entity Retains Discretion to Avoid

question 6

True/False

In a constructive obligation where the entity retains discretion to avoid any future sacrifice of economic benefits,no liability should be recognised in the financial statements.

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Definitions:

Salesperson

An individual who sells goods and services to other entities, usually in exchange for money.

Credit And Debit Cards

are financial tools used for electronic transactions; credit cards allow borrowing against a line of credit, while debit cards withdraw funds directly from a bank account.

Carrying More Cash

The practice of holding a greater amount of liquid assets or physical currency on hand than usual, often for transactional purposes or as a precaution.

Psychological Pricing Tactics

Pricing strategies that aim to influence a customer's perception of the price to make a product more attractive, such as pricing items just below a round number.