Which of the Following Best Describes Why the Predicted Incremental

question 8

Multiple Choice

Which of the following best describes why the predicted incremental earnings arising from a given decision are not sufficient in and of themselves to determine whether that decision is worthwhile?

• A)They do not tell how the decision affects the firm's reported profits from an accounting perspective.
• B)They are not easily predicted from historical financial statements of a firm and its competitors.
• C)These earnings are not actual cash flows.
• D)They do not show how the firm's earnings are expected to change as the result of a particular decision.
• E)They do not tell us how profits change from an accounting perspective.

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Definitions:

Discrepancy

A difference between two or more items, facts, or figures, often leading to further investigation or analysis.

Acculturation

Changing to adapt to a new culture.

Bicultural

Refers to individuals or systems combining or navigating between two distinct cultures, typically involving the assimilation of elements from both.

Bilingual

The ability to speak and understand two languages with a high level of proficiency.