The Best Policy Response to a Disturbance May Be to Do

question 29

Multiple Choice

The best policy response to a disturbance may be to do nothing if,

• A)there are long and variable outside lags
• B)a disturbance is short-lived
• C)the inside and outside lags are both short
• D)the recognition lag is negative
• E)both A)and B

---

Definitions:

Salaries Accrued

Salaries that have been earned by employees but have not yet been paid by the company, representing a liability on the balance sheet.

Accounting Period

A specific time period for which financial information is reported, often a quarter or a year.

Supplies Expense

Supplies expense refers to the cost associated with items consumed or used up in the operation of a business, which are not directly part of the manufactured product.

Income Statement

A financial document that summarizes a company's revenues, expenses, and profits or losses over a specific period.