Which of the Following Statements Is Not True About Positive

question 21

Multiple Choice

Which of the following statements is not true about Positive Accounting Theory?

• A) It is used to distinguish research aimed at explanation and prediction.
• B) It is designed to explain and predict which firms will, and which firms will not, use a particular method, and also prescribes which method a firm should use.
• C) It focuses on the relationships between the various individuals involved in providing resources to an organisation, and how accounting is used to assist in the functioning of these relationships.
• D) One of the key theories that underpins Positive Accounting Theory is Agency theory.

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Definitions:

Interpersonal Relations

The social connection or interaction between two or more individuals.

Deliberate System

A cognitive process that is slow, analytical, and effortful, often used when making complex decisions that require attention to detail.

Automatic System

cognitive processes that operate below the level of conscious awareness, enabling quick and efficient responses to stimuli.

Consumer Reports

An American magazine and organization providing unbiased product reviews, ratings, and comparisons to help consumers make informed purchasing decisions.