Which of the Following Is Not a Problem Caused by Diversity

question 46

Multiple Choice

Which of the following is not a problem caused by diversity in accounting practices across countries?

• A) Comparing companies in the same industry that are headquartered in different countries.
• B) Translating foreign currency balances into U.S. dollars.
• C) Converting local GAAP financial statements into U.S. GAAP for consolidation purposes.
• D) Maintaining separate accounting records in both the local and U.S. GAAP.
• E) Identifying and retaining personnel who are competent to prepare financial statements in both international and domestic accounting standards.

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Definitions:

Credit Limitations

Restrictions that cap the amount of credit that can be extended to a borrower by a lender.

Refundable Tax Credit

A tax credit that can reduce the taxpayer's liability to zero, with any remaining amount being paid out as a refund.

Nonrefundable Tax Credit

A tax credit that can reduce the amount of tax owed to zero, but cannot result in a tax refund.

Tax Credit

A tax benefit that directly reduces the amount of tax owed dollar for dollar.