The Definition of Accounting Has Three Principal Elements

question 74

Multiple Choice

The definition of accounting has three principal elements.Which of the following is not one of them?

• A)Distinguishing relevant from irrelevant information
• B)Calculating amounts to record in the AIS
• C)Reporting financial results
• D)Using the information to make informed judgments

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Definitions:

Marginal Cost

The heightened cost involved in the production of one additional product or service unit.

Marginal Benefits

The supplementary benefit or enjoyment a person gets by consuming another unit of a good or service.

Rational Choice

The theory in economics and sociology that suggests individuals always make prudent and logical decisions that provide them with the highest amount of personal utility.

Positively Correlated

Describes a relationship between two variables where they move in the same direction, meaning if one variable increases, the other also increases and vice versa.