The Adjustment for Salaries Is Necessary

question 99

Multiple Choice

The adjustment for salaries is necessary:

• A) because the employer did not have enough cash to write the paychecks.
• B) to recognize the revenue in the period earned.
• C) to recognize the expense in the period incurred.
• D) only in the month of a holiday.

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Definitions:

Variable Costs

Costs that vary directly with the level of production or the volume of output.

Lease

A contract by which one party conveys land, property, services, or goods to another for a specified period, usually in exchange for periodic payments.

Bouquets

A collection or arrangement of flowers.

Short-Run Marginal Cost

The increase in cost a company faces to produce one additional unit of output when some inputs are fixed in the short term.