A Company Is Most Likely to Utilize the Specific Identification

question 34

Multiple Choice

A company is most likely to utilize the specific identification method if its inventory consists of:

• A)Unique products.
• B)Very expensive products.
• C)A relatively small number of products.
• D)All of the other answers are reasons to utilize the specific identification method.

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Definitions:

Recognizing Revenue

The process of recording revenue in the accounting records once it is earned and realizable, in accordance with relevant accounting standards.

Performance Obligation

A commitment in a contract to transfer a good or service to a customer, for which a company must satisfy to recognize revenue.

IFRS

International Financial Reporting Standards, which are a set of accounting standards developed by the International Accounting Standards Board (IASB) used globally to prepare public company financial statements.