The Credit Balance That Arises When a Net Loss on a Purchase

question 56

Multiple Choice

The credit balance that arises when a net loss on a purchase commitment is recognized should be

• A)presented as a current liability.
• B)subtracted from ending inventory.
• C)presented as an appropriation of retained earnings.
• D)presented in the income statement.

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Definitions:

Purchasing Cards

Payment cards issued by an organization to its employees to make purchases on behalf of the organization, simplifying the procurement process.

Online Payments

Electronic transactions where money is transferred via the internet as payment for goods or services purchased online.

Decentralized

A system or network arranged in a way where control or decision-making is distributed rather than being centralized in a single authority.

Digital Currency

A form of currency that is available only in digital or electronic form, not in physical form like paper money or coins.