Which of the following subsequent events might require an adjustment to the client's financial statements?
A)A business combination with another company.
B)A major customer declares bankruptcy causing a material receivable to be uncollectible.
C)Loss of plant and equipment due to a fire.The loss in insured.
D)Plant employees could possibly go on strike.

Question

Quizplus · Accepted Answer

The bankruptcy of a major customer causing a material receivable to be uncollectible would result in a significant impact on the financial statements and would require adjustment. A, C, and D may also have an impact on the financial statements, but they do not necessarily require adjustments depending on the circumstances.

Which of the Following Subsequent Events Might Require an Adjustment