The Use of Alternative Accounting Principles

question 134

Multiple Choice

The use of alternative accounting principles

• A) is not a problem in ratio analysis because the notes to the statements disclose the principles used.
• B) may be a problem in ratio analysis even if disclosed.
• C) is not a problem in ratio analysis since eventually all principles will lead to the same end.
• D) is only a problem in ratio analysis with respect to inventory.

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Definitions:

Mental Incapacity

A condition where an individual is unable to understand or make rational decisions due to mental disability or disorder.

Unconscious

A state in which a person is not awake and not aware of and responding to their environment.

Legal Representative

An individual or organization officially appointed to act on another's behalf in legal matters or proceedings.

Market Value

The current price at which an asset or service can be bought or sold in an open and competitive marketplace.