Allowing Firms to Estimate Rather Than Physically Count Inventory at Interim

question 46

Multiple Choice

Allowing firms to estimate rather than physically count inventory at interim (quarterly) periods is an example of a trade-off between

• A)verifiability and reliability.
• B)reliability and comparability.
• C)timeliness and verifiability.
• D)neutrality and consistency.

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Definitions:

Customer Disputes

Conflicts between a business and its customers typically over product or service quality, charges, or contractual obligations.

Better Business Bureau

A non-profit organization focused on enhancing marketplace trust by setting standards for ethical business behavior and monitoring compliance among its members.

Sarbanes Oxley

A U.S. federal law that was enacted in 2002 to protect investors from fraudulent financial reporting by corporations, also known as the Sarbanes-Oxley Act of 2002.

Compliance Costs

Expenditures incurred by an organization to ensure it is abiding by relevant laws, regulations, and standards.