You Did Not Understand What the Term Accrual Meant and Failed

question 76

Multiple Choice

You did not understand what the term accrual meant and failed to accrue the interest due at the end of the year on the company's bonds. Which IMA guideline has been violated?

• A) Integrity
• B) Confidentiality
• C) Competence
• D) Objectivity

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Definitions:

Property Tax

A levy imposed by a government on a property owner, based on the value of the property.

Accrue

The process of accumulating or recognizing expenses or income over time, even before cash transactions occur.

Payable

A liability to a creditor, often of a business, that represents an obligation to pay for goods or services received.

Prepaid Insurance

An asset account that represents insurance premiums paid in advance, covering future periods.