Economists Use the Term ________ to Refer to the Creation

question 136

Multiple Choice

Economists use the term ________ to refer to the creation of new capital.

• A) investment
• B) entrepreneurship
• C) depreciation
• D) finance

---

Definitions:

Allowance Method

An accounting technique that adjusts accounts receivable for the estimated uncollectible amounts.

Accounts Receivable

Unsettled charges owed by clients to a company for the consumption or acquisition of goods or services.

Allowance Account

An account used in accrual accounting to estimate future adjustments, such as doubtful accounts or returns, affecting the value of asset accounts.

Percentage of Sales

A financial ratio illustrating how a particular figure on the financial statements reflects a certain percentage of the total sales.