Is an Example of an Explicit Transaction

question 140

Multiple Choice

is an example of an explicit transaction.

• A) Signing a contract to perform services in two months, at which time payment will be received
• B) Paying cash for three months' rent in advance
• C) Recognizing depreciation expense
• D) Accruing earned but unpaid wages at the end of the month

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Definitions:

Straight-Line

A method of allocating an asset's cost evenly over its useful life for purposes of depreciation.

Contra Asset Account

An account on a balance sheet that reduces the value of an associated asset account, such as accumulated depreciation.

Accumulated Depreciation

Accumulated depreciation is the total amount of depreciation expense that has been recorded for an asset, representing how much of its value has been depleted over time.

Cost Expiration

A concept in accounting indicating the point at which a cost becomes an expense, typically when a cost directly contributes to generating revenue.