When a Firm Has a Change in Reporting Entity, It

question 45

Multiple Choice

When a firm has a change in reporting entity, it must disclose ________.

• A) the individual financial statements for each component entity
• B) the effect of the change on net income and EPS for each year presented
• C) the reasons that the company chose to purchase a new business unit
• D) the reasons for the lack of comparability to prior financial statements

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Definitions:

Hypotheses

Proposed explanations made on the basis of limited evidence as starting points for further investigation.

Correlational Studies

Research methods that examine the relationship between two or more variables without manipulating them to determine causation.

Double-Blind Study

An experimental design in which neither the participants nor the researchers know who is receiving a particular treatment, to prevent bias.

Test-Retest Reliability

A measure of consistency where the same test is administered to the same group of people at two different points in time, and the scores are compared.