Which of the Statements Below Is FALSE

question 27

Multiple Choice

Which of the statements below is FALSE?

• A)We use the prior year's financial statements to find the relationship or relative percentage of each line (accounting category)to either the sales revenue or the total assets of the firm.
• B)Forecasted accounting statements are called pro formas for short.
• C)We use the projected sales for the past year as the starting point for all the income statement lines.
• D)Forecasted accounting statements are called pro forma financial statements.

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Definitions:

Attorney General of the United States

The principal legal officer who represents the United States in legal matters and heads the U.S. Department of Justice.

Dodd-Frank Act of 2010

a comprehensive and complex piece of financial reform legislation passed in 2010 in the United States, aimed at preventing the repeat of the financial crisis of 2008.

Securities and Exchange Commission

A U.S. federal agency responsible for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other related activities.

Asset-backed Securities

Financial instruments backed by a pool of assets, such as loans or receivables, which generate revenue for investors.