Which of the Following Actions Best Describes the Qualitative Characteristic

question 6

Multiple Choice

Which of the following actions best describes the qualitative characteristic "relevance"?

• A)The financial report of KMC Ltd was audited by one of the Big 4 four accounting firms.
• B)DGC limited provides quarterly financial reports.
• C)MCB Ltd and DGC Ltd both use accelerated depreciation method.
• D)GEP Ltd did not revalue its intangible assets because it was difficult to obtain the fair value of the assets.
• E)None of the given answers.

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Definitions:

Profitability

Refers to a company's ability to generate earnings over its costs and expenses within a specified time frame.

Absorption Costing

A costing method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed overhead—in the cost of a product.

Return on Investment

A performance measure used to evaluate the efficiency or profitability of an investment, calculated by dividing the return of an investment by its cost.

Markup Percentage

The percentage by which the cost of a product is increased to determine its selling price.