Which of the Following Would Be a Type II Subsequent

question 90

Multiple Choice

Which of the following would be a Type II subsequent event?

• A)Information becomes available that provides evidence about the valuation of an estimate or reserve that had been accrued at year end.
• B)A sale of inventory below carrying value provides evidence that the net realizable value was less than cost at year end.
• C)A stock dividend or split that takes place during the subsequent period should be disclosed.In addition,earnings-per- share figures should be adjusted to show the retroactive effect of the stock dividend or split.
• D)A material change occurs in the value of investment securities after the balance sheet date.

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Definitions:

Purchase of Suits

Purchase of suits refers to the acquisition of formal clothing items, recorded as a business expense if used for professional purposes.

Men's Coats

Clothing items designed specifically for men to wear over their other garments for warmth or protection.

Department Store

A large retail establishment offering a wide range of consumer goods across different product categories under one roof.

Budgeted Purchases

An estimate of the total value or quantity of goods a company plans to purchase over a specific period, typically part of the budgeting process.