Which of the Following Is Correct

question 24

Multiple Choice

Which of the following is correct?

• A) Reported accounting numbers do not affect the transfer of resources.
• B) Credit rating agencies use accounting information to assess only assets.
• C) Efficient capital markets promote productivity and encourage innovation.
• D) Efficient capital markets promote productivity but do not encourage innovation.

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Definitions:

Accumulated Depreciation

The total amount of depreciation expense that has been recorded for an asset since it was put into use.

Wages Expense

The total amount of wages paid by a business to its employees for a specified period of time.

Accounts Receivable

Money owed to a business by its customers for goods or services provided on credit.

Generally Accepted Accounting Principles

A set of accounting standards and procedures adopted in the U.S. that guide how financial statements are prepared and reported.