When a Division Is Set Up and We Enter a Purchase,the

question 5

Multiple Choice

When a division is set up and we enter a purchase,the allocate tool -

• A)will automatically be highlighted
• B)will automatically be dimmed
• C)will be highlighted when an account that allows allocation is selected
• D)will be highlighted only when an asset is purchased

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Definitions:

Income Summary

An account used in the closing process that summarizes the results of operations by collecting all revenue and expense account balances before determining the net income or loss.

Retained Earnings

The cumulative amount of profits that have been reinvested in the business rather than distributed to shareholders as dividends.

Dividends

Dividends disbursed to members holding shares in a corporation, generally originating from the profits of the business.

Salary Expense Accrual

An accounting practice of recognizing salary expenses incurred in a period that has not yet been paid out in order to accurately reflect the company's liabilities.