a) What is the purpose of internal earnings targets? (b) What is the risk associated with internal earnings targets?

Q: How are restrictions of retained earnings reported?

A:

Q: What do the Retained earnings represent?

A: Financial Statement:   They are annual reports of an organization summarizing the financial…

Q: fers to the firm’s decision on what to do with its

A: Step 1   Companies use profit management to adjust profit volatility and present a fixed profit…

Q: What is earnings management?

A: Earnings refer to the amount earned by the business during the financial year. It may vary from year…

Q: Define the term Temporary earnings.

A: Earnings: The term earnings refer to the amount of money the company had earned during a particular…

Q: 3. How do earnings management practices affect the quality of earnings?

A: Earnings quality:   The term earnings quality considers whether the earnings of the company are…

Q: Discuss the components of operating and nonoperating income and theirrelationship to earnings…

A: Meaning of Operating Income Operating Income is also known as Earnings before interest and taxes. It…

Q: Define retained earnings.

A: Definition:   Balance sheet: This financial statement reports a company’s resources (assets) and…

Q: What are the three classifications of restrictions of retained earnings, and how are such…

A: Retained Earnings Retained earnings refer to the net income of the corporation that is retained in…

Q: Define Non-GAAP Earnings.

A: Generally Accepted Accounting Principles (GAAP): These are the guidelines necessary to create…

Q: illustrate the earnings management continuum

A: Answer:-  Earnings management meaning:- Earnings management is the practice of using accounting…

Q: What major items are included in the Retained Earnings Statement?

A: Retained earnings statement  is financial statements that states firm income after every payment.…

Q: Define the term Earnings per common share?

A: Earnings per common share: A company generate the portion of profit or loss every year. Earnings per…

Q: Why must a cost be assigned to retained earnings?

A: Likewise, debt and equity financing, retained earnings has also some cost. The predictor care about…

Q: What is E&P and how is it different than a company's net income?

A: Earnings and profits (E&P) are a company's ability to pay dividends to its shareholders. Many…

Q: Explain retained earnings

A: Answer: The company’s profit generating operations produce retained earnings. These are the total…

Q: What is the definition of “basic earnings per share”

A: Definition: Net income: The bottom line of an income statement which is the result of the excess of…

Q: 1. What is the difference between accounting anc economic profit?

A: Solution Note as per the Q&A guideline we are required to answer the first question only. Please…

Q: 2. Explain the distinction between permanent and temporary earnings as it relates to the concept of…

A: Earnings quality refers to the ability of reported earnings to estimate a company future earnings.…

Q: What is meant by ‘daily earnings at risk’ (DEAR)?

A: Daily earnings at risk depends on the following factors: 1. Position of the dollar rate 2.…

Q: Define each of the following terms: g. Repatriation of earnings; political risk

A: Repatriation means the conversion to a single domestic currency of any foreign currency.…

Q: What assumption is made regarding the external users of financial statements?

A: Financial Statements: The organization records the financial information related to transactions.…

Q: standard setters?

A: Earnings management for contracting causes would be an interest in standard setters because of the…

Q: What is meant by earnings persistence?

A: Earning persistence is one of the attributes of accounting earnings. Basically, it means the…

Q: Who are the steps involved in estimating the earnings per share for an aggregated market service?

A: Earnings per share (EPS) refers to the amount a company makes on each of the common stock…

Q: What are the advantages of regulation of financial reporting?

A: Financial reporting refers to the disclosing of communicating the financial statements to the…

Q: Explain how earnings management from an informational perspective differs from the true income…

A: Earning management means to make the financial statements of the entity with the help of those…

Q: how earnings are extremely important to investor?

A: Earnings relate to the Earnings per share of a corporation. Earnings per share is a critical…

Q: How does earnings management affect earnings quality?

A: Earnings of a company is referred as net income or bottom line item of a company. It is a very…

Q: Why is earnings per share called “the bottom line”? What is EBIT, or operatingincome?

A: Earnings per share is the company’s net revenue/income that can be distributed among its…

Q: How are paid-in-capital and retained earnings: Similar? Different?

A: The answer is as fallows

Q: Define the following. a. Retained earnings? b. Goodwill? c. Investing activities?

A: a. Retained earnings: The amount of earnings undistributed as dividends to the stockholders is…

Q: Explain what is meant by the term earnings quality.

A: The term earnings refer to the amount of money the company had earned during a particular period of…

Q: 2. How do earnings trends compare in terms of both the direction and stability of income?

A: Earnings are profits earned by the business which is very important for a business to survive.…

Q: 2. The change in retained earnings is affected by which of the following?

A: Retained Earnings :  it is treated as liability in the Balance sheet. it comes under the head…

Q: 2. How do non-GAAP earnings relate to the concept of earnings quality?

A:

Q: Describe how volatile the payout ratios are based on earnings and cash flows.

A: Dividends payout ratio can be defined as the paying out the dividends to its shareholders on the…

Q: Define exposure, differentiating between accounting and economic exposure. What role does inflation…

A: Exposure means uncontrollable future events which can affect adversely. In the mechanism of exchange…

Q: The current ratio is useful in determining a company’s ability to pay obligations when they…

A:

Q: Describe restrictions on retained earnings.

A: Definition:   Retained earnings: Retained earnings refer to the net income of the corporation that…

Q: retained earnings is accurately described by all except which of the following statements?

A: The dividends which are declared are deducted from the earnings which are retained. When the…

Q: Explain the types Earnings?

A: Earning is the amount of income that an individual or organization receives during a year.

Q: Define the term permanent earnings.

A: Definition: Earnings: The bottom line of an income statement which is the result of an excess of…

Q: How can earnings management affect the quality of ­earnings?

A: The concept of quality earning shows the amount of earning which is not earned by any default or…

Q: What is earnings quality? What are the possible topics or areas that the reported  earnings may not…

A: When you look at a company's earnings, you can see how good they are by ignoring any anomalies,…