Which of the Following Situations Does NOT Illustrate a Subsequent

question 39

Multiple Choice

Which of the following situations does NOT illustrate a subsequent event that requires adjustment to the financial statement numbers?

• A)A lawsuit against the auditee that had been ongoing for months is finally concluded: the amount awarded is substantially more than had been estimated.
• B)The inventory that was on hand at the balance sheet was sold soon sold after the balance sheet date for a price below its carrying value.
• C)A customer who had long been suspected of being in financial difficulty,declares bankruptcy.Based on the filing,amounts previously thought to be collectible will never be recovered.
• D)A fire that occurred subsequent to the balance sheet date destroys a substantial amount of inventory that was on-hand at the year-end.

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Definitions:

Transcendentalists

Philosophy of a small group of mid-nineteenth-century New England writers and thinkers, including Ralph Waldo Emerson, Henry David Thoreau, and Margaret Fuller; they stressed personal and intellectual self-reliance.

Farm Labor

Refers to the workforce involved in the agricultural sector, including both skilled and unskilled workers engaged in farming tasks.

Seneca Falls Convention

The first women's rights convention held in 1848 in Seneca Falls, New York; it marked the beginning of the women's suffrage movement in the United States.

Abolitionist Movement

The movement primarily in the United States that sought to end the practice of slavery and the slave trade in the 18th and 19th centuries.