Which of the Following Statements Regarding the Role of Cash

question 51

Multiple Choice

Which of the following statements regarding the role of cash in adjusting entries is true?

• A) Adjustments are only made if cash has been received or paid during the period.
• B) Adjusting journal entries do not affect the cash account.
• C) Adjusting entries for expenses include a debit to cash.
• D) Adjusting entries for revenues include a credit to cash.

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Definitions:

Economic Income

The total value of all income received by an individual or entity, including both earned income and investment income.

Human Capital

The skills, knowledge, and experience possessed by an individual viewed in terms of their value or cost to an organization or country.

Compensating Differential

The difference in wages that compensates workers for undesirable aspects of a job, such as long hours or dangerous conditions.

Human Capital

The qualifications, know-how, and lived experiences of a person or society, assessed in terms of their profitability or cost to a business or country.