Which of the Following Is True About the Trends in Operating

question 19

Multiple Choice

Which of the following is true about the trends in operating business organizations?

• A) With the recent financial crises, public attention is moving toward management of limited partnerships.
• B) Shareholders are losing interest and are becoming less active.
• C) The Dodd-Frank Act has mandated rules that prevent shareholders from including their own board candidates in proxy materials.
• D) In many cases, corporations and individuals reasonably have an equal claim to rights and protections under the law.
• E) The focus on legal liability for directors and officers is decreasing.

Understand the necessity and preparation of adjusting and closing entries before the production of financial statements.

Recognize the difference between cash and accrual basis of accounting and their implications on financial statements.

Identify the purpose and timing of revenue recognition in accordance with accrual accounting.

Understand the requirements and justifications for making adjusting entries in the accounting cycle.

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Definitions:

Reportable

Pertains to information or actions that need to be disclosed officially, usually due to regulatory requirements.

Reportable Segments

Parts of a business that are distinguishable by their operations, products, or services and are subject to review by the company's chief operating decision maker.

Tests Applied

Specific criteria or procedures used to evaluate or assess particular conditions, standards, or compliance in various contexts.

Third-Quarter Income Statement

A financial report summarizing a company's revenues, expenses, and net income for the third quarter of its fiscal year.