Which One of the Following Statements Is TRUE

question 18

Multiple Choice

Which one of the following statements is TRUE?

• A) In an agency relationship, the principal delegates decision-making authority to the agent.
• B) In an agency relationship, the agent delegates authority to the principal.
• C) An example of an agency relationship is when the CEO nominates a slate of candidates to be on the board of directors.
• D) An example of an agency relationship is when a supervisor hires a forklift operator.
• E) The supervisor-employee relation between a production line supervisor and a production line operator is an example of an agency relationship.

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Definitions:

Customer Satisfaction Surveys

Tools or questionnaires used by businesses to evaluate the level of satisfaction of their customers with the company's products or services.

Internal Accounting System

The accounting system that collects, aggregates, and generates and distributes budgeted and actual financial and cost information within the firm for use by executives and managers for both decision making and control.

Management Accounting

The accounting system used within the organization to help the organization achieve its goals.

Financial Accounting

Accounting for the revenues, expenses, assets, liabilities, and equities of an organization, concentrating on external users (shareholders, lenders, and government). Constrained by FASB rulings and other generally accepted accounting principles.