Which if the following is an advantage of rules-based accounting standards?

Question

Quizplus · Accepted Answer

Rules-based accounting standards reduce the opportunities for earnings management through judgements. This is because the standards provide specific rules for recognizing revenue, expenses, and other accounting transactions, leaving less room for interpretation and manipulation. However, the other options are not advantages of rules-based accounting standards; the reduced complexity can lead to oversimplification and errors, not all situations can be covered by rules-based standards, and representational faithfulness is not necessarily improved by using specific rules.

Which If the Following Is an Advantage of Rules-Based Accounting