Which of the Following Statements Best Describes the Reporting Process

question 10

Multiple Choice

Which of the following statements best describes the reporting process for profit seeking and governmental entities?

• A) In profit-seeking enterprises the measurement focus is on the flow of all economic resources of the firm, whereas the focus for governmental funds is on current financial resources
• B) In profit-seeking enterprises the measurement focus is on the flow of current financial resources, whereas the focus for government funds is on all economic resources.
• C) Both Profit-seeking enterprises and governmental entities have an objective to measure profitability.
• D) Both Profit-seeking enterprises and governmental entities use the accrual or cash basis of accounting to record and report transactions.

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Definitions:

L.L. Bean, Inc.

An American retailer recognized for its outdoor recreation merchandise and clothing, known for its customer service and satisfaction guarantee.

Responsiveness

The speed and efficiency with which an organization or individual reacts to changes or customer needs.

Texas A&M

A renowned public research university located in College Station, Texas, known for its contributions to education, research, and military service.

Direct Trade-Off

A situation in decision making where increasing one benefit requires the concurrent decrease of another benefit, illustrating the need to balance competing values or priorities.