Which of the Following Accounts Would Be Increased with a Credit

question 170

Multiple Choice

Which of the following accounts would be increased with a credit?

• A) Land; Accounts Payable; Dividends
• B) Accounts Payable; Unearned Revenue; Common Stock
• C) Dividends; Accounts Receivable; Unearned Revenue
• D) Cash; Accounts Receivable; Common Stock

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Definitions:

Compensating Balance

A minimum account balance that a borrower must maintain as a condition for borrowing from a bank.

Short-Term Borrowings

Loans or debt obligations that are due for repayment within one year.

Direct Write-Off Method

A method of accounting for bad debts that charges the amount of an outstanding account directly to the expense account at the time it is deemed uncollectible.

Net Realizable Value

The estimated selling price in the ordinary course of business minus the estimated costs of completion and the estimated costs necessary to make the sale.