If the purchase of a long-term note receivable is included as cost of goods sold,there is a violation of the
A)existence objective.
B)completeness objective.
C)classification objective.
D)timing objective.

Question

Quizplus · Accepted Answer

Classification objective. The cost of a long-term note receivable should not be included as cost of goods sold, as it is not directly related to the sale of goods or services. This is a violation of the classification objective, which requires that items should be properly categorized in financial statements.

If the Purchase of a Long-Term Note Receivable Is Included