As William is preparing the end of year financial statements, he has been asked to reconsider the timing of revenues and expenses in order to report less volatile earnings. This is an example of

Question

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Income smoothing refers to the practice of manipulating the timing and recognition of revenues and expenses to create more stable and predictable earnings. This is often done to avoid large fluctuations in reported earnings that could cause investors or analysts to question the stability of the company's operations. In this scenario, William is being asked to engage in income smoothing by adjusting the timing of revenues and expenses to create a more consistent earnings stream.

As William Is Preparing the End of Year Financial Statements