Multiple Choice
Which of the following statements regarding contractual commitments is INCORRECT?
A) Even though contractual commitments are slightly different, the disclosures fall into the same category as contingencies.
B) Commitments represent contractual promises a company has made to enter into transactions in the future and thus obligate the company to commit resources toward a certain purpose.
C) It would not be proper to accrue commitments because the transactions have not yet occurred as of the balance-sheet date.
D) All contractual commitments must be disclosed, regardless of whether there will be a substantial impact on the company's financial statements in future years.
Correct Answer:
Verified
Correct Answer:
Verified
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