Which One of the Following Subsequent Events Will Least Likely

question 128

Multiple Choice

Which one of the following subsequent events will least likely result in an adjustment to the financial statements?

• A)Material change in the amount of settlement of a lawsuit which had been estimated at year end.
• B)Bankruptcy of a customer who owes your client a material amount on open account at year end for which there is an inadequate allowance estimate.
• C)Sale of a large block of inventory at a price materially below carrying value.
• D)Signing of a letter-of-intent by the client to acquire 55% of another entity for stock.

Calculate dividends to be distributed under different preferred stock conditions.

Journalize stock transactions, including issuance for cash, exchange for assets, and stock subscriptions.

Understand the treatment of stock issued at par, above par, and below par.

Differentiate between types of stock (common, preferred, no-par) and their characteristics.

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Definitions:

Balanced Budget

A budget where revenues equal expenditures, resulting in no deficit or surplus.

New Classical View

An economic theory that emphasizes the importance of supply-side factors, rational expectations, and market-clearing prices.

Fiscal Policy

Government adjustment of its spending levels and tax rates to monitor and influence a nation's economy.

Government Spending

The total amount of public sector expenditure, including spending on infrastructure, healthcare, education, and defense by the government.