Users of Financial Statements Should Consider Which of the Following

question 51

Multiple Choice

Users of financial statements should consider which of the following when evaluating the quality of accounting information?

• A) Economic faithfulness of accounting measurements and classifications.
• B) Reliability of the measurements.
• C) Reasonableness of the estimates made in applying GAAP or IFRS.
• D) All of these should be considered.

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Definitions:

Cognitive Dissonance

The psychological discomfort experienced when holding two or more contradictory beliefs, ideas, or values at the same time.

Attribution Theory

A concept in social psychology that explains how individuals infer the causes of their own and others' behaviors, attributing them to either internal dispositions or external situations.

Foot-In-The-Door Phenomenon

A psychological tactic involving getting a person to agree to a small request to increase the chances of agreeing to a larger request later.

Informational Social Influence

The influence to accept information from others as evidence about reality, often leading to conformity in ambiguous situations.