Saturday, June 2, 2012

A negative consequence of recording byproducts in the accounting records when the sale occurs is

ACCOUNTING

Multiple Choice

A negative consequence of recording byproducts in the accounting records when the sale occurs is

a. the revenue from the byproducts is usually fairly large, and the accounting records will be distorted.

b. managers can time earnings by their decision when to sell byproducts.

c. managers have an incentive to stockpile byproducts.

d. both (b) and (c).

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