Which of the Following Is Not a Typical Reason for Evaluating

question 15

Multiple Choice

Which of the following is not a typical reason for evaluating a government's financial condition?

• A) Prevent financial crises from developing.
• B) Hold management accountable for the use of tax revenues.
• C) Determine if the government can continue to offer the current level of services.
• D) Determine whether residents will receive dividends.

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Definitions:

Profit Margin

A financial metric indicating the percentage of revenue that exceeds the cost of goods sold, showing how much profit a company makes on sales.

Net Income

The sum a company holds as profit once it has subtracted expenses and taxes from its aggregate revenue.

Net Sales

The amount of sales revenue left after deducting sales returns, allowances, and discounts.

Cash Basis

An accounting method where revenues and expenses are recorded only when cash is received or paid, respectively.