Which of These Characteristics Is the Least Important for an Accounting

question 11

Multiple Choice

Which of these characteristics is the least important for an accounting theory to be considered acceptable?

• A)How well the accounting theory has been constructed
• B)How acceptable the implications of the accounting theory are
• C)How prescriptive the accounting theory is in relation to accounting practice
• D)How well the accounting theory explains and predicts reality

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Definitions:

Expected Value

A statistical measure that calculates the average outcome when the future includes scenarios that may or may not happen.

Payoffs

The outcomes or returns from a particular action, investment, or decision, often used in game theory and economics.

Invest

To distribute funds or resources in anticipation of earning profits or income.

Probability

The quantification of an event's probability as a numerical value ranging from 0 to 1, indicating how likely it is to happen.