Which of the Following Adjusting Entries Involves the Recognition of an Accrued

question 83

Multiple Choice

Which of the following adjusting entries involves the recognition of an accrued expense?

• A)recording depreciation on a long-lived asset
• B)writing off the portion of an insurance policy that has expired
• C)recognition of salaries owed to employees for work done during the current period that will be paid during the next accounting period
• D)recognition of bad debt losses that are expected to result from making sales on credit terms

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Definitions:

Wartime Shortages

Periods during war when there is a lack of availability of essential goods and resources due to increased demand and disrupted supply chains.

Opportunity Cost

The benefit missed out on when choosing one alternative over another, emphasizing the impact of choice on resource allocation.

Limited Resources

The finite availability of inputs such as labor, materials, and capital, which restricts production capabilities and economic growth.

Unlimited Wants

The concept in economics that human desires for goods and services exceed the available resources, leading to perpetual states of decision making and prioritization.