In Which of the Following Transactions Would It Not Be

question 12

Multiple Choice

In which of the following transactions would it not be appropriate to recognize an asset in the financial statements?

• A)SGG receives a firm commitment from another company to purchase goods from SGG.
• B)SGG pays $10,000 to a lawyer for services to be provided next year.
• C)SGG provides services to another company, but will not be paid until after year end.
• D)A customer of SGG makes a deposit of $1,500 for goods to be custom-made.

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Definitions:

Announcing Negative News

The process of delivering unfavorable or disappointing information to individuals or groups in a manner that aims to minimize negative reactions.

Negative Announcement

Communication that delivers bad news, unfavorable decisions, or undesirable outcomes.

Negative News

Information delivery that conveys unfavorable, adverse, or disappointing information to the recipient.

Present Bad News

This involves delivering unfavorable or negative information in a manner that attempts to minimize upset or backlash, often utilizing strategies like buffering or indirectness.