Use the Figure to Answer the Following Question(s)

question 175

Multiple Choice

Use the figure to answer the following question(s) .
Figure 10-2
-What is the maximum economic profit this firm depicted in Figure 10-2 will be able to earn?

• A) zero
• B) $20
• C) $30
• D) $100

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Definitions:

Dividends Payable

liabilities representing the amount of dividends declared by a company's board but not yet paid to shareholders.

Accounts Payable

Money owed by a company to its creditors for goods and services that have been received but not yet paid for.

Accrual Basis

An accounting method where revenues and expenses are recorded when they are earned or incurred, regardless of when cash transactions happen.

Cash Basis

An accounting method where revenues and expenses are recognized when cash is received or paid, rather than when earned or incurred.