Comparability Problems Arise Because

question 36

Multiple Choice

Comparability problems arise because

• A)firms may use different generally accepted accounting principles.
• B)inflation may affect firms differently due to accounting conventions used.
• C)financial analysts do not know how to compare financial statements.
• D)firms may use different generally accepted accounting principles, and inflation may affect firms differently due to accounting conventions used.

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Definitions:

Crystallized Intelligence

Crystallized intelligence is the ability to use skills, knowledge, and experience; it does not equate to memory or knowledge but rather the ability to use them appropriately.

Reasoning

Analyzing a subject methodically through logical reasoning to reach a decision or judgement.

Prior Knowledge

Information and understandings that individuals bring to a new learning experience, influencing how they absorb new information.