According to AASB 101,an Entity Will Classify a Liability as Current

question 22

Multiple Choice

According to AASB 101,an entity will classify a liability as current when:

• A)it expects to settle the liability outside its normal operating cycle.
• B)it expects to settle the liability within its normal operating cycle.
• C)the entity has an unconditional right to defer the settlement of the liability for at least 12 months after the reporting date.
• D)the liability is due to be settled more than 12 months after the reporting date.

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Definitions:

Mismanagement

The improper, inefficient, or negligent administration or handling of tasks or resources in a business, organization, or institution.

Merger Failures

Occurrences where the process of combining two or more companies into a single entity fails to achieve anticipated benefits, leading to operational or financial issues.

Valuation-Driven Acquisition

The process of buying a company based on the assessment of its value, often with the objective of acquiring it at a price that is perceived to be below its true worth.

Economic Cycles

Fluctuations in economic activity experienced by a country or the global economy over time, including periods of expansion, peak, contraction, and trough.