An Increase in a Revenue Account May Reflect an Increase

question 15

True/False

An increase in a revenue account may reflect an increase in an asset account.

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Definitions:

Expenses

Costs incurred in the process of earning revenue, typically including things like rent, salaries, and utilities.

Prepaid Advertising

Prepaid advertising refers to the costs paid in advance for advertising services or spaces that will be used over time, recognized as an asset until the advertising takes place.

Balance Sheet

This document outlines a business's resources, obligations, and the equity held by shareholders at a specified time.

Contra Asset

An account on a company's balance sheet that reduces the total amount of an associated asset account, often used for accumulated depreciation.