A Major Drawback of Using Historical Results for Judging Current

question 47

Multiple Choice

A major drawback of using historical results for judging current performance is that ________.

• A) past results may be inaccurate
• B) results may refer to a different manager
• C) inefficiencies may be concealed in past results
• D) managers may have cooked the books

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Definitions:

Non-voting

Shares that confer ownership in a company but do not grant the shareholder voting rights in the company's corporate decisions.

Cash Outflows

Expenditures of cash by a business, including operating expenses, investment outlays, and financing payments.

Dividend

A fraction of a corporation's profits allocated to its stockholders, often as cash or more shares.