WorldCom Classified $3

question 22

Multiple Choice

WorldCom classified $3.85 billion in operating expenses as long-term investments. How would this make WorldCom's financial statements more attractive to investors?

• A) by decreasing depreciation
• B) by reducing capital expenditures
• C) by raising its reported earnings
• D) by boosting its cash flows

Recognize the symbols and formulas for population and sample statistics.

Analyze and interpret histograms and their characteristics.

Understand the measures of relationship between variables (correlation).

Calculate and interpret coefficients of variation, skewness, and kurtosis as measures of relative dispersion, asymmetry, and peakedness of distributions respectively.

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Definitions:

Credibility

The quality of being trusted and believed in, important in financial reporting and accounting practices.

Net Sales

The sum of sales income left over after subtracting returns, allowances for damaged or missing goods, and discounts.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including material and labor expenses.

Income Statement

It's a financial statement that shows a company's revenues, expenses, and profits or losses over a specific period.