Conservative Accounting Refers to

question 74

Multiple Choice

Conservative accounting refers to

• A) a manager's tendency to shirk his stewardship responsibilities.
• B) a manager's engagement in greater risk taking.
• C) a decision to downplay the negative and focus on the positive.
• D) a decision to downplay the positive and focus on the negative.

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Definitions:

Convertible Preferred Shareholders

Shareholders who own shares that can be converted into a fixed number of common shares, usually at the discretion of the shareholder.

Increased Profits

A situation where a company's earnings exceed its previous earnings over a certain period, indicating improved financial performance.

Rich Vein of Gold

Refers to a significant and high-quality deposit of gold ore.

Dividends

Earnings from a corporation distributed to its shareholders, usually from its profits.