When Comparing the Relative Conservatism of U

question 13

Multiple Choice

When comparing the relative conservatism of U.S. versus foreign companies,

• A) U.S. firms tend to be less conservative than Japanese firms, because Japanese firms are more heavily influenced by tax law.
• B) U.S. firms are more conservative than Continental European firms due to the dominance of capital market disclosures in the United States.
• C) European firms are less focused on tax law than are the U.S. firms.
• D) British firms are more conservative than U.S. firms, because they tend to take goodwill to income rather than to equity as is the case in the United States.

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