Which One of the Following Might Be Affected by a Change

question 96

Multiple Choice

Which one of the following might be affected by a change in revenue recognition requiring a prospective change?

• A) retained earnings
• B) management compensation
• C) unearned revenue
• D) deferred taxes

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Definitions:

Operating Expenses

Costs related to the day-to-day functioning of a business, excluding cost of goods sold, such as rent, salaries, and utilities.

Department Managers

Individuals responsible for overseeing the operations, staff, and financial aspects of a particular department within an organization.

Centralized Business

An organizational structure where decision-making and key processes are managed at the highest levels or from a single central location or headquarters.

Operating Decisions

Choices made by management regarding daily operations of a business that affect its efficiency and effectiveness.