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Question

Which of the following best describes the distinction between expenses and losses?

Accepted Answer

Losses result from peripheral or incidental transactions, whereas expenses result from ongoing major or central operations of the entity.

Answer

Losses are extraordinary charges, whereas expenses are ordinary charges.

Answer

Losses are reported net of related tax effect, whereas expenses are not reported net of tax.

Answer

Losses are material items, whereas expenses are immaterial items.

Answer

None of these answers.

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