Which of the Following Are Potential Reasons Why TRS Over

question 3

Multiple Choice

Which of the following are potential reasons why TRS over short periods of time may not reflect the actual performance of a company and its management?
I.A well-performing company may not deliver a high TRS if the expectations include knowledge of the performance.
II.When TRS is analyzed in its traditional way,it does not show the degree to which improvements in operations produced or increased the TRS.
III.Outside factors such as changing interest rates can affect TRS and be unrelated to the firm's operations.
IV.TRS is difficult to calculate for short periods of time.

• A)II and IV.
• B)I and II.
• C)II and III.
• D)I,II,and III.

---

Definitions:

Critical Event

A significant occurrence or change that impacts an organization's operations or decision-making process.

Measurability Conditions

Criteria used to determine whether the financial impact of an event can be reliably measured and should be recognized in the financial statements.

Installment Sales Method

An accounting method where revenue is recognized at the time of cash collection rather than at the point of sale.

IFRS

International Financial Reporting Standards; a set of accounting standards developed by the International Accounting Standards Board that is becoming the global standard for the preparation of public company financial statements.