Which of the Following Is an Example of a Compensating

question 313

Multiple Choice

Which of the following is an example of a compensating differential?

• A)Two workers with different levels of on-the-job training earn different salaries.
• B)Two workers whose jobs entail different working conditions earn different salaries.
• C)Two workers whose jobs require different levels of technical expertise earn different salaries.
• D)Two workers with different levels of natural ability earn different salaries.

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Definitions:

Extraordinary Items

Events and transactions that are distinguished by their unusual nature and infrequency, reported separately in financial statements for clearer analysis.

Earnings Per Share

A measure of a company's profitability that calculates how much money shareholders would receive for each share they own if all of the profits were distributed to them.

Component of the Business

A segment or section of a company that can be identified operationally and for financial reporting, often seen as a distinct part of the business that could be separated or sold.

Extraordinary Item

A term previously used in accounting for events and transactions that were both unusual in nature and infrequent, which is no longer preferred under most financial reporting frameworks.