An estimation transaction involves
A)a decision by management to estimate an incurred cost
B)a decision by management to estimate a future price
C)a decision by management to estimate a future amount
D)a decision by management to estimate a future profit

Question

Quizplus · Accepted Answer

An estimation transaction involves a decision by management to estimate a future amount, such as future revenue or future expenses. Therefore, option C is the best choice. Option A is incorrect because it describes an actual cost, not an estimation. Option B is incorrect because it describes a future price, not an estimation. Option D is incorrect because it describes a profit, which is a combination of revenue and expenses, and not a specific estimation.

An Estimation Transaction Involves