The Payment for Rent of the Office Building for One

question 16

Multiple Choice

The payment for rent of the office building for one month would include a:

• A)debit to Cash.
• B)debit to Prepaid Rent.
• C)credit to Revenue.
• D)debit to Rent Expense.

---

Definitions:

Diminishing Marginal Returns

A principle in economics where each additional unit of input results in a smaller increase in output than the previous unit, at a certain point.

Marginal Cost

The additional cost incurred in producing one more unit of a product, emphasizing the concept of optimizing production levels.

Average Total Cost

The total cost per unit of output, calculated by dividing the total cost of production by the total quantity produced.

Average Variable Cost

The variable cost (e.g., labor, materials) per unit of output, calculated by dividing total variable costs by the number of units produced.