Which of the Following Statements Is(are) True Regarding Financial Measures

question 43

Multiple Choice

Which of the following statements is(are) true regarding financial measures?
(A) One disadvantage of using financial measures to evaluate performance is that they are typically reported on a monthly, quarterly, or annual basis.
(B) One reason financial measures are used to evaluate performance is that they are easily quantifiable.

• A) Only A is true.
• B) Only B is true.
• C) Both of these are true.
• D) Neither of these is true.

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Definitions:

Expense Recognition

The accounting principle that expenses should be recognized in the period in which they are incurred, regardless of when payment is made.

Economic Life

The expected period during which an asset remains useful to a particular entity or project, often affecting its depreciation schedules.

Business Entity

An organization established as a separate legal entity for the purposes of conducting business, such as a corporation, partnership, or sole proprietorship.

Time Periods

Specific intervals or durations used for accounting and reporting purposes, such as fiscal quarters or years.