The Process by Which a Financial Transaction Is Recorded So

question 23

Multiple Choice

The process by which a financial transaction is recorded so that its flow through the system can be followed is called:

• A)Financial shadowing
• B)Managerial trace technique
• C)Concatenation
• D)An audit trail

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Definitions:

Cost of Goods Available for Sale

The total cost of merchandise that a company can sell during a certain period, including both its beginning inventory and the cost of any goods purchased during the period.

Expense Recognition

The accounting principle that expenses should be recorded in the period in which they are incurred, regardless of when the cash is paid.

Assets

Resources owned by a business.

Liabilities

Financial obligations or debts a company owes to others, which must be settled over time by transfer of economic benefits.