Sam Jones,controller of Mitnikco,spends three days researching the accounting statements to find loopholes in the "rules" and to make a case for recognizing revenue earlier,rather than in later years.In the end,this enables the Company to achieve its earnings targets.What are the motivations of Mitnikco management based solely on the information above?
A)Pressures
B)Opportunity
C)Rationalization
D)Skepticism

Question

Quizplus · Accepted Answer

Rationalization is the process of making excuses or finding reasons to justify one's actions. In this case, Mitnikco management is rationalizing their decision to recognize revenue earlier by claiming that they are simply following the "rules" and that they are doing what is necessary to achieve their earnings targets.

Sam Jones,controller of Mitnikco,spends Three Days Researching the Accounting Statements