Upon Reading the Notes to the Financial Statements of JMR

question 77

Multiple Choice

Upon reading the notes to the financial statements of JMR Ltd.,you notice that the policies they have chosen tend to recognize revenue early in the earnings cycle while deferring costs to later periods.This approach leads you to believe that JMR Ltd.is employing a(n) :

• A) Smoothing strategy.
• B) Income tax minimization strategy.
• C) Income tax maximization strategy.
• D) Profit maximization strategy.