Transactions with and Amounts Receivable from or Payable to a Key

question 27

Multiple Choice

Transactions with and amounts receivable from or payable to a key management person and their related parties are excluded from additional disclosures when:

• A) The transactions occur within a normal employee, customer or supplier relationship on terms and conditions no more favourable than those that it is reasonable to expect the entity would have adopted if dealing with an unrelated person.
• B) The information about them does not have a potential to affect adversely decisions about the allocation of scarce resources made by the users of the financial report, or the discharge if accountability by the key management person.
• C) These are trivial or domestic in nature.
• D) All of the given answers.
• E) The transactions occur within a normal employee, customer or supplier relationship on terms and conditions no more favourable than those that it is reasonable to expect the entity would have adopted if dealing with an unrelated person and the information about them does not have a potential to affect adversely decisions about the allocation of scarce resources made by the users of the financial report, or the discharge if accountability by the key management person.

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Definitions:

Lower Of Cost

A principle that requires inventory to be recorded at the lower of its historical cost or the market value.

Market Method

A valuation method that prices assets or liabilities based on current market prices or values.

Original Costs

The initial monetary value paid or incurred for an asset, including purchase price and any additional charges necessary to bring it to its current location and condition.

LIFO Perpetual

LIFO Perpetual is an inventory costing method that assumes the last items produced or purchased are the first to be sold, with continuous inventory and cost of goods sold updating.