Which Pair of the Listed Accounts Follows the Rules of Debits

question 43

Multiple Choice

Which pair of the listed accounts follows the rules of debits and credits in relation to increases and decreases in the same manner?

• A)Salaries and Wages Expense and Notes Payable
• B)Common Stock and Rent Expense
• C)Prepaid Rent and Advertising Expense
• D)Service Revenue and Equipment

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Definitions:

Inputs

Resources, such as labor, materials, and capital, that are used in the production process to create goods and services.

Minimum Cost

The lowest possible cost at which a particular set of goods or services can be produced or acquired without sacrificing quality or quantity.

Factor Prices

The prices of the inputs used in the production process, such as labor wages, capital rental rates, and raw material costs.

Production Function

An equation that describes the output of a production process, given the quantity of inputs used.