The Conceptual Framework of Accounting Should Have Many Positive Effects

question 47

Multiple Choice

The conceptual framework of accounting should have many positive effects as new accounting standards are developed. Which of the following is not one of those effects?

• A) Financial statements among companies and industries should be more consistent and comparable.
• B) Standard setting should be more consistent with an overall statement of the objectives and concepts of financial reporting.
• C) Users' understanding and confidence in financial statements should increase.
• D) Management should have greater latitude in choosing among accounting alternatives.
• E) Accountants should be better able to assess the validity of different accounting alternatives for similar and dissimilar transactions and events.

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Definitions:

M

A symbol often representing money supply in economic discussions, including various measures like M1, M2, and M3.

Q

Quantity, frequently used in economic equations and discussions to denote the amount of goods produced or consumed.

PQ

The product of price (P) and quantity (Q), often used in economics to calculate total revenue or expenditure.

P

Typically refers to "Price" in economic models, representing the monetary value assigned to a good or service in the market.