The Purpose of This 2002 Act Was to Improve Financial

question 13

Multiple Choice

The purpose of this 2002 act was to improve financial reporting and reinforce the importance of corporate ethics.

• A)Foreign Corrupt Practices Act
• B)Sarbanes-Oxley Act
• C)Securities and Exchange Act
• D)Treadway Act

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Definitions:

Straight-Line Depreciation

A method of allocating the cost of a tangible asset over its useful life in equal annual amounts.

Fair Value

The estimated market value of an asset or liability, based on current prices in an active market.

Acquisition Method

The acquisition method is an accounting technique used in consolidations to combine the financial statements of a parent company and its subsidiary, recognizing the acquired assets and liabilities at their fair values.

Consolidated Balance Sheet

A financial statement that summarizes the financial position of a parent company and its subsidiaries, presenting assets, liabilities, and equity as if the group were a single entity.