Which of the Following Is Not True Regarding Accounting Estimates

question 90

Multiple Choice

Which of the following is not true regarding accounting estimates?

• A) Accounting estimates are based on management's knowledge and experience of past and current events.
• B) Accounting estimates are based on management's assumptions about conditions that are expected to exist and courses of action the company expects to take.
• C) Accounting estimates are based on both subjective and objective factors
• D) Because accounting estimates are based, in part, on management's knowledge and experience, they are not biased.

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Definitions:

Infinite

A concept describing something without any limit or end.

Terms

Provisions and requirements detailed in a contract or agreement.

Rational Investor

An individual who makes decisions based on thoughtful consideration of expected outcomes, aiming for the maximization of utility or profit.

Interest Rate

The proportion of interest a borrower is charged for using funds borrowed from a lender.