Which of the Following Statements About Planned Obsolescence Is True

question 171

Multiple Choice

Which of the following statements about planned obsolescence is true?

• A) Environmentalists support planned obsolescence.
• B) A company that is interested in producing a quality product would never engage in planned obsolescence.
• C) Style modification creates planned obsolescence.
• D) Planned obsolescence is not an ethical issue.
• E) All of the statements about planned obsolescence are true.

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Definitions:

Indirect Method

A method used in cash flow statement preparation that adjusts net income for changes in balance sheet accounts to convert it from accrual to cash basis.

Net Income

The total profit of a company after subtracting all expenses, taxes, and costs from total revenue.

Statement Of Cash Flows

A financial statement that highlights the major activities that impact cash flows and, hence, affect the overall cash balance.

Operating Activities

These involve the primary day-to-day activities of a business, such as sales and the purchase of goods or services, which are reflected in its cash flow.