Author Question: In 2002, WorldCom was accused of falsifying information regarding liabilities on WorldCom's balance ... (Read 88 times)

Starlight · **on:** Jun 29, 2018

In 2002, WorldCom was accused of falsifying information regarding liabilities on WorldCom's balance sheets, thereby

A) increasing WorldCom's net worth on the balance sheet.
B) reducing WorldCom's profit on the balance sheet.
C) increasing WorldCom's assets on the balance sheet.
D) reducing WorldCom's net income on the income statement.

Question 2

Tying the salaries of top managers to the firm's stock price or to the profitability of the firm allows a firm's board of directors to

A) avoid disclosing financial statements to investors.
B) eliminate moral hazard.
C) increase asymmetric information.
D) reduce the principal-agent problem.