Which statement defines a Type 1 subsequent event?
A)An event that provides evidence of conditions that arose after the date of the financial statements
B)An event that provides evidence of unreported earnings that arose after the date of the financial statements.
C)An event that provides evidence of conditions that existed at the date of the financial statements.A Type I event requires an adjustment to the financial statements.
D)An event that provides evidence of conditions that did not exist at the date of the financial statements.A Type I event requires an adjustment to the financial statements.

Question

Quizplus · Accepted Answer

A Type 1 subsequent event provides evidence of conditions that existed at the date of the financial statements and requires an adjustment to the financial statements. It is an event that occurs after the balance sheet date but before the financial statements are issued or available to be issued, and provides additional information about the conditions that existed at the balance sheet date.

Which Statement Defines a Type 1 Subsequent Event