With Respect to the SEC

question 80

Multiple Choice

With respect to the SEC,

• A) the attitude of the SEC is generally considered in any major change proposed by the FASB.
• B) the SEC is the sole agency responsible for setting generally accepted accounting principles.
• C) the SEC requirements of greatest interest to CPAs are set forth in their enforcement regulations.
• D) the SEC has the power to establish rules for all CPAs.

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Definitions:

Qualitative Factors

Non-numeric considerations that affect decision-making, planning, and management, such as employee satisfaction, brand reputation, and customer loyalty.

Present Value

Present value is the current worth of a future sum of money or stream of cash flows given a specified rate of return, crucial in evaluating investment opportunities.

Compound Interest

This is when interest is earned on the principal amount as well as on the interest that has accumulated in earlier periods.

Earnings Rate

The rate at which a company or an investment grows its profit over a specific period, usually expressed as a percentage.