How conservative the company’s reporting methods are

Reference no: EM131408187

The following information was taken from the annual report of Sega-Venus Enterprises.

a. Compute Sega-Venus's conservatism ratio, and comment on how conservative the company's reporting methods are.

b. Explain why the conservatism ratio provides a measure of the extent to which a company's financial accounting methods are conservative, and provide examples of accounting treatments that may increase or decrease the ratio.

Reference no: EM131408187

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