alleryStart learning →A shop refunds beyond the law under a published policy. The obligation is:
ALegal obligation
BContingent asset
CConstructive duty
DOnerous contract
Answer & Solution
Correct answer: C. Constructive duty
Past practice plus a published policy creates a valid expectation in customers, which is a constructive obligation.
Keep practising AS 29 Provisions and Contingencies
Browse all AS 29 Provisions and Contingencies questions for CA Inter, or explore more Accounting topics.
Related questions
Use of estimates in preparing a provision:A present obligation where outflow is not probable is classed as a:To whom can an obligation be owed?Which obligation exists independently of the entity's future actions?A restructuring plan creates an obligation only if it is meant to:Which is evidence that a restructuring plan has started to be implemented?An executory contract falls within the provisions rules only if it is:Depreciation and doubtful debt provisions are really: