CFA Practice Question

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CFA Practice Question

Ratios for all companies following generally accepted accounting principles ______

A. will always be standardized.
B. can vary due to different accounting treatments.
C. will always be correct.
Correct Answer: B

Generally accepted accounting principles can lead to substantially different financial statements for similar companies, depending on the accounting treatments the companies elect.

User Contributed Comments 3

User Comment
viannie different accounting treatment for example: inventory -> FIFO or LIFO or etc ...
johntan1979 Depreciation, bad debt write-off...
jabiller Generally accepted and can vary do not make sense.
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