Which of the Following Items Is Consistent with Earnings Not

question 48

Multiple Choice

Which of the following items is consistent with earnings not being informative about current performance but are informative about future earnings?

• A) The firm recognizes an unexpected gain
• B) The firm recognizes a fair value gain on a financial asset as a result of a favorable move in interest rates.
• C) The firm recognizes additional expenses this period due to pre-opening costs associated with new stores.
• D) The firm experiences a large jump in sales and earnings as a result of successful research and development of new products.

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Formulate Arguments

The process of developing and structuring logical and coherent reasons or explanations in support of a particular stance or viewpoint.

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The principle of being unbiased, unprejudiced, and impartial, especially in analysis, reporting, or decision-making.

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Politeness, respect, and consideration shown by individuals in conducting their social or business interactions.