The SEC Was Given the Power to Establish Accounting Principles

question 49

Multiple Choice

The SEC was given the power to establish accounting principles including setting requirements for details shown on financial statements by the:

• A) FASB
• B) AICPA
• C) Congress
• D) AAA

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Definitions:

Real Asset(s)

Physical or tangible assets that have intrinsic value such as real estate, commodities, and natural resources.

Agency Problem

Conflicts of interest among stockholders, bondholders, and managers.

Shareholders

Individuals or entities that own shares in a corporation, thus having a claim on part of the company's assets and earnings.

Security Selection

The process of choosing stocks or other securities for investment, aiming to achieve better performance than a selected benchmark.