Use the Following to Answer Questions 31 and 32

question 13

Multiple Choice

Use the following to answer questions 31 and 32:
REFERENCE 11-01
A foreign subsidiary of a U.S.-based company has been notified of a loss contingency with an estimated cost ranging between $220,000 and $250,000 which is probable of resulting in an actual loss. Each dollar amount within this range of cost is equally likely of being the actual outcome.
[QUESTION]
REFER TO: 11-01
-According to IFRS, what is the amount recognized as a provision for loss contingency?

• A) No amount will be recorded but an amount will be disclosed in the notes to the financial statements.
• B) $110,000
• C) $220,000
• D) $235,000
• E) $250,000

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Definitions:

Market Development

The expansion of a market through the identification and penetration of new market segments or geographic areas.

Microfinance

A type of financial service provided to unemployed or low-income individuals or groups who otherwise lack access to traditional banking services.

Collateral

An asset that a borrower offers to a lender as a security for a loan, which can be seized if the loan is not repaid.

Savings Deposits

Bank accounts that pay interest on the money deposited, meant for saving rather than daily transactions.