An Expenditure Qualifies as A(n) _____ If It Has the Following

question 88

Multiple Choice

An expenditure qualifies as a(n) _____ if it has the following characteristics: 1.It embodies a probable future benefit.
2) A particular entity can obtain the benefit and control others' access to it.
3) The transaction or other event giving rise to the entity's right to, or control of, the benefit has already occurred.
4) The fair value of the item at the time of initial recognition can be measured with sufficient reliability.

• A)asset
• B)liability
• C)shareholders' equity
• D)revenue
• E)expense

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Definitions:

Ambiguous

Describes statements or terms that are unclear or have multiple interpretations, often leading to confusion or misunderstanding.

Buyer

An individual or entity that purchases goods or services for personal use, resale, or production purposes.

Inspect

To examine something carefully in order to assess its condition or to discover its existence.

Defective

Having a fault or flaw that reduces the item's intended function or value, often leading to unsatisfactory performance.