Accrual Accounting,which Attempts to Match Sales Revenues and the Expenses

question 28

Multiple Choice

Accrual accounting,which attempts to match sales revenues and the expenses associated with the production of the goods,is conducted in an attempt to:

• A) reduce income-tax liability.
• B) reduce bias in reported profitability measures.
• C) speed up the receipt of accounts receivable.
• D) reduce the time necessary to depreciate assets.

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Definitions:

Declare Bankruptcy

The formal process by which an individual or business legally declares their inability to pay outstanding debts.

Involuntary Bankruptcy

A legal process initiated by creditors to force a debtor into bankruptcy when they believe the debtor is unable to pay their debts.

Petition

A formal written request, often signed by many people, appealing to authority with respect to a particular cause or concern.

Debtor

An individual or organization that owes money to another entity.