Which of the following transactions would be acceptable as a provision under IAS 37? XY decided to
Question:
XY decided to reorganise a manufacturing facility during June 2020 and commissioned a consulting engineer to undertake a feasibility study.
A provision of $2 million for the reorganisation was created as at 31 August 2020. In September 2020, AB contracted with a training company to provide essential training for its workforce to be carried out in October and November 2020.
A provision for the necessary expenditure was created in its accounts at 31 August 2020.
CDE was ordered by its local authority in October 2020 to carry out an environmental clean-up in 2021 following pollution from one of its factories.
GY acquired HT and provided for likely future operating losses at the date of acquisition amounting to $250,000.
Managerial Accounting
ISBN: 978-0078025518
2nd edition
Authors: Stacey Whitecotton, Robert Libby, Fred Phillips