multiple-choice questions

Which of the following statements is true about financial statement analysis and equity valuation?

		Financial statements of publicly listed firms are prepared using cash accounting rather than accrual accounting.
		Accounting profits are typically less informative about firms economic performance than cash flows.
		A firms industry choice, competitive positioning and corporate strategy all influence the difference between the firms actual and required return on capital.
		A disadvantage of the residual earnings valuation model is that it produces lower equity value estimates for firms that use conservative accounting policies (e.g., overestimate inventory impairment) than for firms that use aggressive accounting policies (e.g., underestimate inventory impairment).