If ron agrees to use "book and hold" to boost his current month's sales and therefore the firm's revenues, which document used by investors, bankers, and others, will reflect this fact?

This question is incomplete, here is the full question:

If Ron agrees to use “book and hold” to boost his current month’s sales and therefore the firm’s revenues, which document used by investors, bankers, and others, will reflect this fact?

a) Statement of cash flows

b) Balance sheet  

c) Income statement

d) Accounting equation

The answer is d)

Explanation:

"Book and hold" is a controversial issue in accounting and financial reporting for quite some time, as it's outcome is the unreal inflating of sales and revenues. It relies on recognizing revenues generated at the point of sale - immediately, not waiting for the goods to be delivered to the customer.

The same can be done for decreasing expenses, making the amount spent look insignificant compared to the real spending. The practice of "booking and holding" has been considered unethical. However, having in mind the big impact "pretty" numbers in financial reports have on stakeholders, accountants and other relevant employees may feel the urge to use this method.

Since income is the indicator most influenced by this practice, the answer is income statement. The balance sheet reflects on the structure of assets, liabilities and stockholders' equity, while the statement of cash flows refers to outbound and inbound movement of cash, thus reflecting on the company's liquidity, not income. The accounting equation is not even a financial statement, so it is irrelevant for the question.

answer; ///decision making under risk;