A Profitable Mature Company Would Generally Have

question 23

Multiple Choice

A profitable mature company would generally have

• A) High price/book and high price/earnings
• B) High price/book and low price/earnings
• C) Low price/book and high price/earnings
• D) Low price/book and low price/earnings

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Definitions:

Segregation of Duties

A principle in accounting and corporate governance that aims to reduce the risk of error and fraud by dividing responsibilities among different individuals or departments.

Accounts Receivable

Financial obligations of clients or customers towards a business for received goods or services that are awaiting payment.

Subsidiary Ledger

A subsidiary ledger is a group of similar accounts whose totals summarize into a single amount shown in the general ledger, aiding detailed financial analysis and tracking.

Fraud Triangle

The fraud triangle is a model that explains the factors that lead individuals to commit fraud: pressure, opportunity, and rationalization.