Which of the Following Is a Conservative Accounting Practice

question 54

Multiple Choice

Which of the following is a conservative accounting practice?

• A)Change from double-declining balance to straight-line depreciation.
• B)Record sales revenue before it is actually earned.
• C)Adjust the allowance for uncollectible accounts to a larger amount.

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Definitions:

Price-fixing

An illegal agreement among competitors to cooperate on setting prices at a certain level, eliminating competition and harming consumer interests.

AU Optronics

A Taiwan-based electronics company specializing in the manufacture of TFT LCD panels used in televisions, computer monitors, and other digital display devices.

LCD Screens

Thin, flat display devices made up of a number of color or monochrome pixels arrayed in front of a light source or reflector.

Dominant Price Leader

A firm that has the largest market share within an industry and whose pricing decisions are often followed by its competitors.