A Company Has Chosen Accounting Policies That Result in Maximizing

question 31

Multiple Choice

A company has chosen accounting policies that result in maximizing its net income.Which of the following is not a reason for doing this?

• A)To comply with loan agreement maintenance tests
• B)For favourable performance evaluation
• C)For cash flow prediction
• D)To attract new investors

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Definitions:

Internal Control

The processes and procedures implemented by an organization to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.