Which of the Following Statements Is Correct

question 51

Multiple Choice

Which of the following statements is correct?

• A)Accrual-based net income can be manipulated because it is based on estimates.
• B)Cash flows are easily manipulated because they are based on estimates.
• C)Accrual-based net income is not easily manipulated because valuation for such items as bad debts and inventory are precise and based on objectively verifiable information.
• D)Cash flows are not easily manipulated because they are generated by internal transactions and do not involve external parties.

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Definitions:

Clearinghouse

A central agency for the collection, classification, and distribution of information or transactions.

Incorrect NPI

Refers to an error in the National Provider Identifier, a unique identification number for health care providers in the United States.

Abuse

The intentional mistreatment or harmful behavior towards another person, animal, or entity that can be physical, emotional, sexual, or neglectful.

Without Intent

An action or outcome occurring without the intention or purpose of causing it, often relevant in legal contexts regarding liability.