For Which of the Following Reasons Is the Time-Period Assumption

question 129

Multiple Choice

For which of the following reasons is the time-period assumption necessary?

• A) Inflation exists and causes confusing swings in financial statement amounts over time.
• B) External users of financial statements want accurately reported net income for a specific fiscal year.
• C) Financial statement users expect full disclosure of all economic events throughout the entire time period.
• D) It is required by the federal government.

---

Definitions:

Implicit Leadership Theories

Individual beliefs and assumptions about the traits and behaviors that make an effective leader, often influencing perceptions and expectations of leadership in practice.

Reciprocity

Reciprocity refers to a mutual exchange of privileges or interactions between two or more parties, where each party offers something in return for what is received.

Follower Role Orientation

The manner in which followers view their role and responsibilities in relation to leaders and the organization.

Organizational Outcomes

The results or consequences of an organization's actions, including its performance, employee satisfaction, and financial health.