There Is a Concern That Research and Development May Be

question 31

Multiple Choice

There is a concern that research and development may be reduced as a result of the new requirements in AASB 138 because:

• A) Companies will not have the cash available to pay for the research expenses up-front.
• B) Recognising expenses early will allow for larger profits later, which will help smaller firms.
• C) The 'horizon problem' suggests managers will not invest in long-term projects that do not immediately increase profits.
• D) Shareholders are only interested in short-term profits and will not be impressed by strategies that attempt to increase the long-term value of their shares.

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Definitions:

Organizational Socialization Process

The method through which new employees acquire the necessary knowledge, behaviors, and skills to become effective members of an organization.

Demands

The requirements or needs that must be met, often used in the context of work, where it may refer to tasks or duties expected to be completed.

Encounter Stage

The phase in a social or professional relationship where individuals first meet and form impressions, often determining the future of their association.

Organizational Socialization Process

The method through which new employees gain the necessary knowledge, skills, and behaviors to become effective members of an organization.