Which of the Following Correctly Describes the Effects of Accruing

question 105

Multiple Choice

Which of the following correctly describes the effects of accruing income tax expense at year-end?

• A)A cash payment is made to pay the taxes due.
• B)Liabilities are not affected.
• C)Retained earnings decreases.
• D)Net income increases.

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Definitions:

Proportions

Fractions or percentages that represent part of a whole or a ratio of one quantity to another.

Proportions

Ratios that compare the part of a whole to the whole itself, often expressed in terms of a fraction or percentage.

Chi-squared Goodness-of-fit Test

A statistical test used to determine whether observed frequencies differ significantly from expected frequencies specified by a theoretical distribution.

Rule of Five

An empirical rule suggesting that extreme observations in data, more than five standard deviations from the mean, are rare.