Generally Accepted Accounting Principles (GAAP) Permits Firms to Choose Among

question 346

True/False

Generally accepted accounting principles (GAAP) permits firms to choose among different methods of depreciation and inventory valuation.

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Definitions:

Continuing Operations

The portions of a business’s activities expected to continue for the foreseeable future, as opposed to activities that are being discontinued or phased out.

Loss

A financial term referring to the situation where expenses exceed revenues, leading to negative profit.

Stock Dividend

A distribution by a corporation to its shareholders using extra shares instead of monetary payment.

Retained Earnings

The portion of a company's profits that is held or retained and not paid out as dividends to shareholders.