An Entity Has Decided to Commit Itself to the Purchase

question 27

Multiple Choice

An entity has decided to commit itself to the purchase of a new building in the next financial year.Under the Framework:

• A) a liability exists because it is probable that a future sacrifice of economic benefits will be required
• B) no liability exists because there is no present obligation
• C) a liability exists because there is a constructive obligation
• D) a liability exists because there is an equitable obligation

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Definitions:

Wrongful Dismissal

The termination of an employee's contract of employment in violation of the law or contractual terms, often leading to legal action.

Constructive Dismissal

An employer's significant change to an employee's terms of employment without the employee's consent, leading the employee to resign.

Unfair Treatment

Acts of injustice or discrimination in various contexts, including workplaces, based on biases or inequalities.

Nonunionized Employees

Workers who are not members of a labor union and thus rely on individual agreements with their employers regarding work conditions, wages, and benefits.