Which One of the Following Is Not a Recognized Method

question 196

Multiple Choice

Which one of the following is not a recognized method of recognizing assets as expenses in a particular accounting period?

• A)Customers' account balances in accounts receivable are assigned to expense in the period in which each customer pays.
• B)Prepaid insurance is assigned to expense as the insurance expires.
• C)A building is depreciated and its cost is assigned to the current and future accounting periods in which the building is expected to be used.
• D)Merchandise inventory is assigned to cost of goods sold in the period the goods are sold.

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Definitions:

Necessity

Goods or services considered essential for basic human survival and well-being, such as food, water, and shelter.

Income Percentage

A measure or fraction of personal or household income, often used in context to describe expenditure, saving, or taxation ratios.

Inelastic Demand

A situation in which the demand for a product does not significantly change in response to a change in price.

Cigarette-Tax Revenues

The money collected by governments through the taxation of cigarettes and tobacco products, often used to fund public health initiatives.