Answer: The correct answer is "a. the ability of management to use accruals to reduce the volatility of reported earnings over time.".
Explanation: Income smoothing refers to <u>the ability of management to use accruals to reduce the volatility of reported earnings over time.</u>
The smoothing of earnings is a practice that consists in reducing fluctuations in recognized income and, therefore, fluctuations in earnings. That is, the smoothing of earnings implies saving income in bonanza times to recognize them accountingly when income is meager.
Answer:
well if it's dull books, shouldn't it be vocabulary. if it were concentrated she would be bored and her mind would wander elsewhere. but if it were vocabulary she would still find it dull. As if it were a dictionary, nobody wants to spend 5 hours reading every word in the dictionary
Answer and Explanation:
Please find answer and explanation attached
Answer: ER(P) = Rf + β(Rm-Rf)
ER(P) = 1.9 + 1(10.6-1.9)
ER(P) = 1.9 + 1(8.7)
ER(P) = 10.6%
Explanation: In this question, CAPM will be used in determining the expected return of the stock. The risk free rate was not given but it was derived from the difference between overall stock market return and risk-premium ie 10.6%-8.7%, which is equal to 1.9%. In addition, the beta of the stock is 1, which corresponds to market beta. The application of the stated figures in the CAPM formula gives an expected return of 10.06%.
