In the Framework,'the present obligation of the entity arising from past events,the settlement of which is expected to result in an outflow from the entity of resources embodying economic benefits' is the definition of:
A) revenues
B) assets
C) expenses
D) liabilities

Question

Quizplus · Accepted Answer

The definition provided is that of a liability, which represents an obligation of the entity to transfer resources or provide services to another party in the future as a result of past events. Liabilities have economic value and typically involve the payment of money or other resources to settle the obligation. Revenues represent inflows of economic resources, while assets are resources controlled by the entity that have the potential to generate economic benefits. Expenses are reductions in economic resources resulting from the entity's ongoing operations.

In the Framework,'the Present Obligation of the Entity Arising from Past