Which of the following is a Bright-line test?
A: An item is deemed material if it is large in size.
B: An item is deemed material if it is large enough to influence CEOs decision making.
C:An item is deemed to material if it exceeds 10% of net income.
Answer is B: An item is deemed material if it is large enough to influence CEOs decision making.( A bright-line rule, also known as a bright-line test, is a standard which is intended to be unambiguous and prevent subjective interpretation. Bright-line tests are commonly used to make quick, predictable and consistent decisions. )
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