According to the Framework for Preparation and Presentation of Financial

question 11

Multiple Choice

According to the Framework for Preparation and Presentation of Financial Statements of the IASB, what is the definition of income?

• A) Assets minus liabilities
• B) Revenue minus expenses
• C) Increase in equity (other than from transactions with owners)
• D) Inflow of resources with future economic benefit

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Definitions:

Long-term Obligations

Commitments or debts that a company is required to pay over a period longer than one year, encompassing both financial and non-financial liabilities.

Assessing Future Performance

The process of analyzing and evaluating a company's potential future financial health and operational success.

Financial Statements

Documents that provide an overview of a company's financial condition, including balance sheets, income statements, and statements of cash flows.

Liquidity

The ability of an asset to be quickly converted into cash with minimal loss of value.