The Statement That Best Describes the Interaction of Academic and Professional

question 8

Multiple Choice

The statement that best describes the interaction of academic and professional research interests with respect to accounting theory,is:

• A)Academic and professional research interests are incompatible as academic research centres on positive theories which are not prescriptive
• B)Academic researchers use positive accounting theories whereas the accounting profession uses normative theories
• C)While accounting profession researchers seek normative (prescriptive)theories for accounting practice,these theories are not incompatible with academic (positive)theories which can be used to advise accounting professionals in the development of prescriptive practices
• D)None of the above

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Definitions:

Coal

A combustible black or brownish-black sedimentary rock used primarily as a source of energy and heat.

Tariff

A tax imposed on imported goods and services to protect domestic industries or raise government revenue.

Opportunity Cost

The forfeiture of potential benefits from other options when a particular choice is made.

Protective Tariffs

Tariffs imposed by a government to protect domestic industries from foreign competition by raising the price of imported goods.