Use the Information Below for Adams Company to Answer the Questions

question 63

Multiple Choice

Use the information below for Adams Company to answer the questions that follow.
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Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year. Below is a list of all the jobs for the quarter:
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Jobs 356, 357, 358, and 359 were completed. Jobs 356 and 357 were sold at a profit of $500 on each job.
-What is the gross profit for Adams Company at the end of the first quarter?

• A) $1,685
• B) $2,685
• C) $1,000
• D) $685

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Definitions:

Valuation

The process of determining the present value of an asset or company based on earnings, assets, and other relevant factors.

AASB 110

The Australian Accounting Standards Board standard that provides the guidelines for the treatment of events after the reporting period, including their recognition and disclosure in financial statements.

Adjusting Event

An event occurring after the reporting period that provides additional evidence about conditions that existed at the end of the reporting period.

Non-Adjusting Event

An event that occurs after the reporting period that does not necessitate adjustments to the financial statements because it does not provide new information about conditions at the end of the reporting period.