Components of Earnings Quality Include

question 84

Multiple Choice

Components of earnings quality include:

• A)proper revenue and expense recognition.
• B)low operating expenses compared to sales.
• C)high and improving gross margin.
• D)all of the above.

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Definitions:

Domestic Corporations

Companies that are incorporated (i.e., formed under the corporate laws) in and operate within the country in which they were founded.

Board of Directors

A group of individuals elected to represent shareholders and govern the affairs of a corporation.

Finalize Deal

To complete the negotiations and formal agreements of a business transaction, making it official and binding.

Asset Sale

The process of selling off individual assets of a company, such as real estate, machinery, or intellectual property, rather than transferring ownership of the company itself.