Answer-A provision for onerous contract is:

An onerous contract is one in which the unavoidable costs of meeting the obligations exceed the economic benefits expected to be received. A provision is recognized for the present obligation under such a contract.

Question

A provision for onerous contract is:

A A liability recognised when unavoidable costs exceed economic benefits under contract

B A contingent asset

C Treated as deferred tax only

D Written off against revaluation reserve

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A provision for onerous contract is:

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