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One of the limitations to accounting is that it only records transactions that have occurred: therefore customer orders are not recorded until fulfilled and anticipated

One of the limitations to accounting is that it only records transactions that have occurred: therefore customer orders are not recorded until fulfilled and anticipated growth is not recorded until it occurs.

True or False

Analysts must remeasure all assets from historical cost to current market value in order to make effective analyses of profitability.

True or False

The term sustainable earnings refers to the concept that repeatable earnings streams, such as from the sale of core products, are of more value than transitory earnings elements from one-time items.

True or False

For an earnings stream to qualify as a core earning activity, it must remain the same for many years. Therefore Apples earnings from sale of Apple watches are not considered a core earning activity.

True or False

An analyst should pay special attention to restructuring expenses, because they can be used as an earnings management tool to either record operating expenses that related to past periods or the current year, and sometimes include expenses that would otherwise be recorded in operations in a future period.

True or False

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