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A Company's Reported Earnings Are $1,000 and Cash Flows Are

Question 26

Multiple Choice

A company's reported earnings are $1,000 and cash flows are $600. Based on economic conditions during the year, the company booked allowances of $250. As a result of contractual incentives, the company booked a further $150 in accruals. How much are the unbiased accruals?


A) $150
B) $250
C) $400
D) $600

Correct Answer:

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