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The Quality of Earnings Is Considered to Be Higher When

Question 51

Multiple Choice

The quality of earnings is considered to be higher when ________.


A) the internal and external risks of the company are higher
B) revenues are recognized early or expenses are postponed to a later period
C) the company has an incentive-based compensation plan for executives that is tied to earnings per share
D) management chooses accounting methods that result in conservative earnings

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