- CFA Exams
- CFA Level I Exam
- Topic 4. Financial Statement Analysis
- Learning Module 10. Financial Reporting Quality
- Subject 4. Detection of Financial Reporting Quality Issues
CFA Practice Question
If a company is the only one in the industry to capitalize certain costs, while others treat them as expenses, the company is expected to ______, other things being equal.
B. be more liquid
C. have a higher revenue
A. be more profitable
B. be more liquid
C. have a higher revenue
Correct Answer: A
While it may appear more profitable, the company might have lower confidence in the quality of the reported numbers.
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