Which of the Following Is Not a Performance Obligation

question 268

Multiple Choice

Which of the following is not a performance obligation?

• A) A good that the seller could sell separately and that is separately identifiable from other goods or services in the contract.
• B) A right of return.
• C) An option for a customer to purchase goods under terms that are more advantageous than those enjoyed by other customers.
• D) An extended warranty.

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Definitions:

Monetary Profit

Financial gain achieved when the revenue generated from business activities exceeds the expenses, costs, and taxes involved in sustaining the operation.

Adequate Standard

A benchmark or level of quality deemed acceptable or sufficient for its intended purpose, often used in contexts related to living conditions, performance, or regulatory compliance.

Taxes

Mandatory financial charges or levies imposed by a government on its citizens to fund public expenditure and services.

Generalized Reciprocity

A form of exchange that involves giving goods or services with the expectation that their value will be reciprocated at an unspecified future time.