Which One of the Following Statements Is False

question 51

Multiple Choice

Which one of the following statements is false?

• A)The basic accounting equation does not subdivide liabilities into two categories: claims of creditors and claims of the Canada Revenue Agency.
• B)The accounting equation can be expressed as: Assets - Shareholders' Equity = Liabilities.
• C)The accounting equation can be expressed as: Assets + Liabilities = Shareholders' Equity.
• D)If the assets owned by a business total $100,000 and liabilities total $52,000, shareholders' equity must total $48,000.

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Definitions:

Expected Value

The calculated average of all possible values for a random variable, weighted by their respective probabilities.

Risk-loving

A term describing an individual's preference or inclination towards taking risk, often in the pursuit of higher rewards.

Risk-neutral

An attitude towards risk where an individual does not prefer or avoid risk, being indifferent between a certain outcome and a gamble with the same expected value.

Fair Bet

A gamble or bet in which the expected value of the winnings equals the cost of playing, indicating no advantage for the bettor or the house.