The concept of profit that is generally regarded as the most useful in predicting future profits is:
A) the comprehensive income approach
B) the operating-profit approach
C) the all-inclusive approach
D) No difference is seen in the usefulness of the different profit approaches in predicting future profits

Question

Quizplus · Accepted Answer

The operating-profit approach focuses on the core operations of the business and excludes non-operating items that are less predictable and less relevant in forecasting future profits. This approach gives a clearer picture of the company's ability to generate profits from its ongoing operations and is therefore regarded as the most useful in predicting future profits.

The Concept of Profit That Is Generally Regarded as the Most