Building Restoration, Inc. (BRI), enters into a contract to refurbish an old train depot for Casual Dining, Inc., to open as Eat Up Restaurant. If BRI completes most of the work promised in the contract, its performance will be
A. absolute.
B. complete.
C. material.
D. substantial.
Answer: D
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Management representation letters Barrett Jennings, CPA, has prepared a letter of representation for the president and controller to sign. The following items are contained in it: (a) Inventory is fairly stated at the lower of cost or market and
includes no obsolete items. (b) All actual and contingent liabilities are properly included in the financial statements. (c) All subsequent events, relevant to the financial statements, have been disclosed. Required: (1) Why is it desirable to have a letter of management representation letter from the client concerning these matters when the evidence accumulated during the course of the audit is meant to verify the same information? (2) How is the letter of management representation useful as audit evidence? (3) What are several other types of information commonly included in the management representation letter?
Maintaining consistent high product quality
a. is both required for and a by-product of the just-in-time environment. b. is difficult to obtain in a just-in-time environment because of the severe time constraints imposed by the just-in-time environment. c. requires quality control inspectors at each step of the production process. d. is too expensive to obtain in a just-in-time environment.
The international structural stages model suggests that a typical evolutional path for an international company's structure would be
A. from international division to worldwide product division to geographical area division. B. from geographical area division to worldwide product division to global matrix. C. from international division to geographical area division to worldwide product division. D. from functional division to horizontal company to virtual corporation. E. from international division to worldwide product division to global matrix.
What is the purpose of the accrual basis of accounting?
A. Recognizing revenue when it is earned and expenses when they are incurred, regardless of when cash changes hands. B. Recognize expenses when cash disbursements are made. C. Match assets with liabilities during the proper accounting period. D. Recognize revenue when it is collected from customers.