Management Compensation Plans

question 51

Multiple Choice

Management compensation plans:

• A)May be affected by adopting International Financial Reporting Standards since earnings under IFRS are typically higher than GAAP earnings.
• B)May be affected by adopting International Financial Reporting Standards since earnings under IFRS are typically lower than GAAP earnings.
• C)Will not be affected by IFRS since earnings are equivalent to GAAP.
• D)Are decided by shareholders who do not consider GAAP or IFRS when deciding how much compensation managers receive.

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Definitions:

Standard Form

A way of structuring arguments or expressions according to fixed rules, often to clarify logical relations.

Categorical Conclusion

A statement resulting from a syllogistic argument, characteristic of being definitive and relating to categories or classes.

Argument

An explanation or collection of explanations offered to justify the correctness or incorrectness of a particular action or notion to persuade others.

Hypothetical

Based on or involving a hypothesis; not real but imagined for the purpose of discussion or further investigation.