Which of the Following Is an Example of a Compensating

question 142

Multiple Choice

Which of the following is an example of a compensating differential?

• A)paying workers with more years of experience higher wages than workers with fewer years of experience, all else equal
• B)paying workers who work on the day shift lower wages than workers who work the night shift, all else equal
• C)paying accountants who have passed the Certified Public Accountant exam higher wages than accountants who have not passed it, all else equal
• D)All of the above are examples of compensating differentials.

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Definitions:

Net Income

Net income is the total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue, indicating the company's profitability.

Carrying Amount

The net value of an asset or liability according to a company's balance sheet.

Supplies Used

Expenses related to consumable items used in the operation of a business.

Supplies Account

An account used to track the cost of supplies not immediately consumed by the business, often classified as a current asset.