A Credit to a Liability Account

question 39

Multiple Choice

A credit to a liability account

• A)indicates an increase in the amount owed to creditors.
• B)indicates a decrease in the amount owed to creditors.
• C)will always increase shareholders' equity.
• D)must be accompanied by a debit to an asset account.

Understand the concepts of controllable and uncontrollable costs.

Recognize the importance of classifying costs for performance evaluation, budgeting, and financial management.

Identify the components and functions of a management accounting system.

Understand direct, indirect, fixed, and variable costs and how they relate to manufacturing.