It Is Fairly Easy to Manipulate Many Types of Judgments

question 8

Multiple Choice

It is fairly easy to manipulate many types of judgments by selecting

• A) average comparitors that are typical.
• B) extreme comparitors that may be unrepresentative.
• C) comparitors that are both better and worse than the event that is being judged.
• D) as many comparitors as possible that are similar to the event being judged.

Understand how accrual accounting impacts the presentation of financial information and its relation to cash flows and earnings.

Grasp the central role of cash flow assessment in evaluating a company's financial health.

Differentiate between the methods of valuing a company and the exclusions in the valuation process.

Calculate and interpret price/earnings ratios and their relation to equity cost of capital.