The Purpose of the Notes to the Financial Statements Are

question 25

Multiple Choice

The purpose of the notes to the financial statements are to:

• A) explain any resources and obligations not recognised in the Statement of Financial Position
• B) provide information meeting the disclosure requirements under national laws or regulations.
• C) disclose risks and uncertainties affecting the entity.
• D) all of the above.

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Definitions:

Equilibrium Price

The price at which the quantity of goods supplied equals the quantity demanded, hence, the market is in balance.

Market Price

The ongoing rate at which an asset or service is being offered for buying or selling.

Shortage

An instance where the desire for a good or service outstrips its availability at a given price.

Price Floor

A government or regulatory imposed minimum price set above the equilibrium price, preventing market prices from falling below a certain level.