Which of the Following Is Not an Objective of Generally

question 18

Multiple Choice

Which of the following is not an objective of generally accepted accounting principles?

• A) To minimize the amount of income taxes owed.
• B) To ensure that both preparers and users of financial statements understand the concepts and assumptions used in presenting information within these statements.
• C) To enhance the relevance and reliability of information contained in financial statements.
• D) To increase the comparability of financial statements prepared by different companies.

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Definitions:

Goal Conflict

A situation where different parties have objectives that are at odds with one another, leading to tension or disagreement.

Cash Budget

A financial plan that estimates cash inflows and outflows over a specific period of time to help manage a company's liquidity and ensure it has enough cash to meet its obligations.

Nonmanufacturing Business

A business that primarily sells services or goods that are not produced by the company, such as retail or consulting.

Primary Budget

The initial budget plan created for a specific period, outlining expected income, expenses, and allocations before any adjustments.