Which of the Following Is Not an Effect of the IFRS

question 36

Multiple Choice

Which of the following is not an effect of the IFRS for SMEs?

• A)It omits topics in IFRS that are not relevant to SMEs
• B) It allows the easier option when IFRS permits accounting policy choices
• C) It simplifies many principles for recognizing and measuring assets, liabilities, income, and expenses
• D) It requires significantly greater disclosures

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Definitions:

Rate of Return

The improvement or reduction in the value of an investment within a specified interval, articulated as a percentage of the investment’s first cost.

Cash Inflow

Money coming into a business or project from various sources, including sales, investments, and financing activities.

Profitability Index (PI)

A calculation that determines the relative profitability of an investment, indicating the ratio of payoff to investment amount.

Internal Rate of Return (IRR)

The Internal Rate of Return (IRR) is the rate at which the net present value of all the cash flows (both positive and negative) from a project or investment equals zero, used as a benchmark to decide the profitability of an investment.