Accounting Policy Changes Are Only Justifiable When There Is a Change

question 81

True/False

Accounting policy changes are only justifiable when there is a change to a primary source of GAAP.

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Definitions:

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, resulting in decreased costs per unit.

Perfect Competition

A market structure characterized by many buyers and sellers, homogenous products, no barriers to entry, and perfect information.

Pure Monopoly

A market structure where a single seller controls the entire market for a particular product or service, facing no competition.

Economic Efficiency

A state where every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency.