Which of the Following Statements About Earnings Quality Is False

question 100

Multiple Choice

Which of the following statements about earnings quality is false?

• A) Earnings quality is enhanced when managers are afforded discretion and judgment in applying accounting standards.
• B) Permanent earnings result in higher earnings quality, while transitory earnings result in lower earnings quality.
• C) Earnings quality is of considerable interest not only to investors and creditors but also to auditors, regulators, and academics.
• D) Earnings quality captures the degree to which reported income provides financial statement users with useful information for predicting future firm performance.

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Definitions:

Fertility Rates

The average number of children born to a woman over her lifetime within a population.

Continuous Childbirth

The phenomenon of having multiple childbirths in close succession without extended periods between pregnancies.

Forced Abortions

Abortions that are carried out without the consent of the pregnant individual, often under coercion or as a matter of policy.

One-Child Policy

A population control policy of China, implemented from 1979 to 2015, which limited many families to only one child in an effort to curb rapid population growth.