.Which of the following is not a reason for economic income and accounting incom

Question

.Which of the following is not a reason for economic income and accounting income to differ?

Select one:

a. Transaction basis

b. The monetary assumption

c. Conservatism

d. Earnings management

Which of the following statements concerning interim financial reports is incorrect?

Select one:

a. Accrual accounting is used for revenue and expense recognition

b. Extraordinary items are reported in annual but not interim financial reports

c. LIFO liquidation is not reported for interim purposes, unless decline in inventory is expected to be permanent

d. Income taxes are accrued using effective tax rate expected for the annual period

Explanation / Answer

1 The monetary assumption is not a reason for economic income and accounting income to differ 2 Extraordinary items are reported in annual but not interim financial reports is incorrect

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