Pro forma earnings:
A)Are management's view of permanent earnings.
B)Are needed for the correction of errors.
C)Are standardized under generally accepted accounting principles.
D)Are useful to compare two different firms' performance.

Question

Quizplus · Accepted Answer

Pro forma earnings are management's view of what the company's earnings would be if certain events or transactions had occurred. They are not standardized under generally accepted accounting principles and are not useful to compare different firms' performance. Instead, they are intended to reflect the company's ongoing, permanent earnings potential.

Pro Forma Earnings