Question

The following are typical disclosures that would appear in the notes accompanying financial statements. For each of the items listed, indicate where the disclosure would likely appear—either in (A) the significant accounting policies note or (B) a separate note.
1. Inventory costing method A
2. Information on related party transactions _____
3. Composition of property, plant, and equipment _____
4. Depreciation method _____
5. Subsequent event information _____
6. Measurement basis for certain financial instruments _____
7. Important merger occurring after year-end _____
8. Composition of receivables _____

Answer 1

Answer:

The answer is:.

1. A

2. B

3. B

4. A

5. B

6. A

7. B

8. B

Explanation:

The significant accounting policy note is a section of the footnotes found in the financial statements. It states and explains the key policies the firm has adopted in preparing its financial statement.

Separate note is also found in the footnotes. It details the additional information about a firm's operations and financial position.

1. A

2. B

3. B

4. A

5. B

6. A

7. B

8. B