In the Traditional Transactions Approach to Income Determination, Income Was

question 23

Multiple Choice

In the traditional transactions approach to income determination, income was measured by subtracting the expenses resulting from specific transactions during the period from revenues of the period also resulting from transactions. Under a strict transactions approach to income measurement, which of the following would not be considered a transaction?

• A) Sale of goods on account at 20 percent markup
• B) Exchange of inventory at a regular selling price for equipment
• C) Adjustment of inventory in lower of cost or market inventory valuations when market is below cost.
• D) Payment of salaries

---

Definitions:

Welfare Benefits

Government-provided assistance programs aimed at supporting the well-being of individuals and families in need.

Grants

These are non-repayable funds or products disbursed or given by one party, often a government department, corporation, foundation or trust, to a recipient, often (but not always) a nonprofit entity, educational institution, business or an individual.

Unemployment Compensation

Unemployment Compensation is financial assistance given to individuals who have lost their jobs involuntarily, providing them with temporary financial support.

Aversion

A strong dislike or disinclination towards something.