The Asset That Results from the Payment of Expenses in Advance

question 29

Multiple Choice

The asset that results from the payment of expenses in advance is

• A)Accounts receivable.
• B)Short-term investments.
• C)Inventory.
• D)Prepaid expense.

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Definitions:

Beginning Inventory

Beginning inventory refers to the value of a company's inventory at the start of an accounting period, which includes raw materials, work-in-progress, and finished goods.

Cost of Goods Sold

The direct financial outlays for the creation of goods a company markets, involving materials and labor.

Ending Inventory

The value of goods available for sale at the end of an accounting period, calculated before the next period's inventory is added.

Debt to Total Assets

A financial ratio that measures the percentage of a company's assets financed through debt.