An Example of Where an Entity Has a Present Obligation

question 8

Multiple Choice

An example of where an entity has a present obligation is:

• A) a public announcement made by an entity's management to undertake restructuring.
• B) a recommendation from the HR manager to the Board as to the level of bonuses to be paid at year end.
• C) a historical pattern of performing a major overhaul of machinery every two years.
• D) the declaration of a dividend by directors which is required to be ratified at a meeting of shareholders

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Definitions:

Instinct

Natural, unchanging behaviors exhibited by animals in reaction to specific triggers.

Drive-Reduction

A theory of motivation that posits the reduction of physiological needs drives behavior towards achieving homeostasis.

Arousal Approach

a theory in psychology that focuses on how arousal levels affect performance, suggesting an optimal level of arousal for peak performance depending on the task complexity.

William McDougall

A psychologist known for his work on instinct theory and social psychology, advocating for the inclusion of innate tendencies in explaining behavior.