Which of the Following Statements About the Quality of Earnings

question 77

Multiple Choice

Which of the following statements about the quality of earnings ratio is true?

• A)When sales are growing,receivables and inventory normally increase faster than trade payable so the ratio increases.
• B)Seasonal variations in sales have no impact on the quality of income ratio.
• C)Failure to accrue appropriate expenses will inflate profit and reduce the quality of income ratio.
• D)Failure to accrue appropriate expenses will inflate net profit and increase the quality of income ratio.

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Definitions:

Personality Inventories

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Characteristics of an individual's actions or reactions to stimuli, which are often influenced by both genetic and environmental factors.

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