Which of the Following Is True with Regards to Judgement

question 115

Multiple Choice

Which of the following is true with regards to judgement and flexibility in selecting accounting methods and applying accounting standards?

• A) Flexibility makes it difficult if not impossible to prepare financial statements that allow users to compare the results of operations of similar companies in the same industry.
• B) Accounting standards allow very little flexibility in the choice of methods as accounting rules tend to be strict and clear minimizing the opportunity for management judgement.
• C) Flexibility in the selection of methods and application of accounting standards allows management to best reflect the economic realities of a company.
• D) Financial statement information is not enhanced by allowing flexibility in the choice of accounting methods used.

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Definitions:

Major Depression

A mental disorder characterized by a pervasive and persistent low mood accompanied by low self-esteem and a loss of interest or pleasure in normally enjoyable activities.

Cognitive Behavioural Therapy

A type of psychotherapeutic treatment that helps patients understand the thoughts and feelings that influence behaviors, focusing on changing negative thought patterns.

Mindfulness-Based Cognitive Behavioural Therapy

This is a therapeutic approach combining mindfulness strategies and practices with cognitive behavioural therapy to address various psychological conditions by improving present moment awareness and cognitive responses.

Compassion

A deep awareness of and sympathy for another's suffering, combined with the desire to alleviate that suffering.