Jen Won $900 in a Lottery

question 20

Multiple Choice

Jen won $900 in a lottery. She has a choice between using the money to buy a sofa, a television, or going on a vacation. If she chooses to buy a television, the opportunity cost of this decision is

• A) zero because she won the money.
• B) the sofa if that was her second choice.
• C) the sofa and the vacation trip.
• D) the sofa, the vacation trip, and $900.

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Definitions:

Calendar Year

A one-year period that begins on January 1 and ends on December 31, used for most financial and tax reporting purposes.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, typically including a balance sheet, income statement, and cash flow statement.

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts.

General Ledger

A complete record of all financial activities conducted by a company throughout its existence.