19-88 Which of the Following Is Not a Least-Cost Resolution

question 55

Multiple Choice

19-88 Which of the following is not a Least-Cost Resolution (LCR) requirement under FDICIA?

• A)Consider and evaluate all possible resolution alternatives by computing and comparing their costs on a present value basis,using realistic discount rates.
• B)Place a bank or thrift into receivership as soon as its capital falls below some positive book value level.
• C)Document the evaluation and the assumption on which it is based.
• D)Retain documentation for at least five years.
• E)Select the least costly alternative based on the evaluation.

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Definitions:

Unsold Units

Inventory items that have not been sold during a specific period, representing potential revenue that has not been realized.

Absorption Costing Balance Sheet

A financial statement that includes all manufacturing costs (direct labor, direct materials, and manufacturing overhead) in the value of finished goods inventory.

Variable Costing

An accounting method that considers only the variable costs directly attributable to the production of goods, excluding fixed manufacturing costs from inventory valuation.

Unsold Units

Inventory items that were not sold during a specific period and are carried over to the next period.