What Occurs When a Business Sells Directly to the Customer

question 49

Multiple Choice

What occurs when a business sells directly to the customer online and cuts out the middle man?

• A) Intermediaries
• B) Disintermediation
• C) Reintermediation
• D) Cybermediation

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Definitions:

Adjustment

Modifications made to account balances in order to correct financial statements or to allocate transactions correctly.

Accrual Accounting

An accounting method that recognizes revenue and expenses when they are incurred, not necessarily when cash is exchanged, enhancing the accuracy of financial statements.

Financial Statements

Formal records of the financial activities and position of a business, organization, or person, including balance sheets, income statements, and cash flow statements.

Adjusting Entries

Journal entries made in accounting to update the accounts and bring them to their correct balances before the preparation of financial statements.