If a Material Amount of Inventory Has Been Ordered Through

question 152

Multiple Choice

If a material amount of inventory has been ordered through a formal purchase contract at the statement of financial position date, for future delivery, at firm prices,

• A) this fact must be disclosed.
• B) disclosure is required only if prices have declined since the date of the order.
• C) disclosure is required only if prices have since risen substantially.
• D) an appropriation of retained earnings is necessary.

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Definitions:

Middle Ear

A part of the ear that contains three small bones known as the ossicles, responsible for transmitting sound from the outer ear to the inner ear.

Auditory Nerve

A cranial nerve that transmits sound information from the cochlea of the inner ear to the brain.

Olfactory Tract

A pathway of neural fibers that transmit smell information from the nose to the brain.

Nasal Cavity

The large air-filled space above and behind the nose in the middle of the face, involved in breathing and olfaction.