Explain the hierarchy of inputs used in determining fair values. The use of which level of input lowers the reliability of fair value estimates?
Answer to relevant QuestionsDescribe the three basic valuation approaches for estimating fair values. Relate the valuation approaches to hierarchy of inputs.What are popular earnings management strategies? Explain.What is the effect of external factors on earnings quality?Explain when costs should be recognized as expenses.Explain what is meant by the term earnings management and what incentives managers have to engage in earnings management.
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