Q390
Low level managers in organizations are to make decisions about
A.
net income irrelevancy
B.
operating income maximization
AnswerC.
operating income minimization
D.
operating income relevancy
Answer: Option B
Solution
Answer: Option B
Solution:
Low level managers in organizations are to make decisions about operating income maximization. Income smoothing is the shifting of revenue and expenses among different reporting periods in order to present the false impression that a business has steady earnings. Management typically engages in income smoothing to increase earnings in periods that would otherwise have unusually low earnings.