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4 October, 19:13

One of the following is an example of managing earnings down (reducing earnings) ?

(A) Reducing research and development expenditures.

(B) Changing estimated bad debts from 3 percent to 2.5 percent of sales.

(C) Revising the estimated life of equipment from 10 years to 8 years.

(D) Not writing off obsolete inventory.

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Answers (1)
  1. 4 October, 22:24
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    The answer is (C) Revising the estimated life of equipment from 10 years to 8 years.

    Explanation:

    Revising estimated life of equipment from 10 years to 8 years has the effect of increasing annual charge of depreciation.
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