Which of the Following Is Considered to Be a Limitation

question 118

Multiple Choice

Which of the following is considered to be a limitation of income statements?

• A) Income statements depend on accounting methods selected.
• B) Income statements evaluate past performance.
• C) Income statements assess uncertainties of achieving future cash flows.
• D) Income statements predict future performance.

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Definitions:

Time-Driven Activity-Based Costing

A financial assessment technique that calculates costs based on actual activities and the duration it takes to complete them, giving accuracy in assigning costs to products.

Tech Support Department

A division of a company providing technical support and services to customers or internal users regarding technological products or services.

Unused Capacity

The available production or service ability that goes unused or is not utilized to its full potential.

Number of Employees

The total count of individuals employed by a business, including part-time and full-time staff.