The Taxpayer Had Incorrectly Been Using the Cash Method of Accounting

question 67

Multiple Choice

The taxpayer had incorrectly been using the cash method of accounting. For 2014, the company voluntarily changed to the accrual method. The adjustment due to the change in method as calculated at the beginning of 2014 was $120,000 (positive) . The adjustment as calculated as of the end of 2014 was $80,000 (positive) . As a result of the change in method, the company must:

• A) Increase its income for 2014 by $120,000.
• B) Increase its income for 2014 by $80,000.
• C) Increase its income for 2014 by $30,000.
• D) Increase its income for 2014 by $40,000.
• E) None of the above.

Identify and understand the impact of news and corporate actions on stock prices under the EMH.

Recognize methods and theories inconsistent with EMH and fundamental analysis in stock picking.

Explain the role of insurance companies in risk management.

Understand speculative bubbles and market irrationality.

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Definitions:

Meta-Analysis

A statistical analysis that combines the results of multiple scientific studies to arrive at a conclusion that is statistically stronger than any single study due to increased numbers of subjects.

Statistical Technique

A method or procedure applied to data collection, analysis, interpretation, and presentation in statistical studies.

Molecular Genetic Studies

Studies of the structure and function of genes that help in understanding how genetic mutations can lead to disease.

Genetic Abnormalities

Variations from the normal sequence in the genetic material of an organism, which may or may not lead to disease or conditions.