An Accountant Who Does Not Understand "Accrual Accounting" Fails Which

question 45

Multiple Choice

An accountant who does not understand "accrual accounting" fails which ethical standard?

• A)Credibility
• B)Competence
• C)Integrity
• D)Confidentiality

---

Definitions:

Average Costs

The total cost of production divided by the number of units produced, giving the cost per unit of production.

Diminishing Returns

A principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase and may even decrease.

Diseconomies of Scale

A phenomenon where production costs per unit increase as a firm's output increases, often due to inefficiencies that arise when companies become too large.

Smaller Percentage Increase

Refers to a rate of increase that is less significant or lower in proportion compared to another.