During the past year, a company had some land expropriated by the local government when the city was widening a road.Management included the gain in operating income as an offset to losses incurred on the sale of some other assets, as they decided that both events were related to fixed assets.This decision by management could be interpreted as earnings management for which of the following reasons?
A)It violates the principles of revenue recognition.
B)It involves management manipulation regarding the timing of the write-down of an asset.
C)It is an example of a big bath.
D)It does not disclose the information on the income statement as per the accounting principles and standards.

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The Answer of During the past year, a company had some land expropriated by the local government when the city was widening a road.Management included the gain in operating income as an offset to losses incurred on the sale of some other assets, as they decided that both events were related to fixed assets.This decision by management could be interpreted as earnings management for which of the following reasons?
A)It violates the principles of revenue recognition.
B)It involves management manipulation regarding the timing of the write-down of an asset.
C)It is an example of a big bath.
D)It does not disclose the information on the income statement as per the accounting principles and standards.

During the Past Year, a Company Had Some Land Expropriated