Which of the Following Is the Principle Reason for Preparing

question 191

Multiple Choice

Which of the following is the principle reason for preparing managerial accounting reports?

• A) usefulness to management
• B) cost of preparation
• C) clarity
• D) GAAP

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Definitions:

Registration Statement

A description, filed with the SEC, of securities being offered for sale; includes an explanation of how proceeds from the sale will be used, information on the registrant’s business and properties, and certified financial statements.

Prospectus

A written document filed with the SEC that contains a description of a security and other financial information regarding the company offering the security; also distributed as an advertising tool to potential investors.

SEC

The U.S. Securities and Exchange Commission, a federal agency responsible for enforcing federal securities laws and regulating the securities industry.

Civil Suit

A legal proceeding in which one party sues another for a wrong that does not involve criminal sanctions, seeking remedies such as damages or specific performance.