Which of the Following Accounting Policies Is Consistent with 'Creative

question 65

Multiple Choice

Which of the following accounting policies is consistent with 'creative accounting'?

• A) A firm with management compensation contract changes its depreciation policy from straight-line to accelerated rate method.
• B) A start-up firm adopts a policy to expense research and development expenses as incurred.
• C) A profit making tobacco producing firm changes its depreciation policy from straight-line to accelerated rate method.
• D) A firm with debt contracts shifts inventory accounting policy from FIFO to LIFO method.

---

Definitions:

Radiant Energy

The energy of electromagnetic waves, including light, radio waves, and X-rays, which can travel through space.

Antipruritic

A substance or treatment that relieves or prevents itching.

Antifungal

Relating to or involving the use of agents that inhibit the growth of or destroy fungi.

Antibiotic

A substance used to kill or inhibit the growth of bacteria, often used in the treatment of infections.