A Primary Distinction Between the Flow of Resources Through a Business

question 27

Multiple Choice

A primary distinction between the flow of resources through a business enterprise and through a governmental entity is that operations in a governmental entity consume resources and assets to

• A)produce goods and services to citizens entitled to receive them.
• B)generate return on investment.
• C)generate net income.
• D)generate capital for future investments.

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Definitions:

Adjusting Entry

Bookkeeping entries executed at the termination of an accounting cycle, intended to apportion income and outlays to their respective periods of occurrence.

Accrue Wages

The process of recognizing wages that have been earned by employees but have not yet been paid out by the company.

Net Income

Net income is the total profit of a company after all expenses and taxes have been deducted from revenue.

Total Assets

The sum of all current and non-current assets that a company owns, as shown on the balance sheet.