Touch Tronix, Inc $€ 680,000$ Of Goods to Advanced Communications, Inc

question 82

Multiple Choice

Touch Tronix, Inc. Sells component parts to Advanced Communications, Inc. a cell phone manufacturer. On December 10, 2011, Touch Tronix, Inc. sold $€ 680,000$ of goods to Advanced Communications, Inc. on account for $€ 880,000$ . Terms of the sale were 2/10, net 30. On December 18, 2011, Advanced Communications, Inc. paid the account in full. Which of the following is true regarding the impact on the statement of financial position for Touch Tronix, Inc. When the payment is made on December 18, 2011?

• A) Assets decreased by \( € 880,000 \).
• B) Assets decreased by \( € 17,600 \).
• C) Assets increased by \( € 862,400 \).
• D) Assets decreased by \( € 13,000 \).

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Definitions:

Depreciated

Refers to the reduced value of an asset after accounting for depreciation expenses over time due to use, wear and tear, or obsolescence.

Accounting Periods

Specific spans of time for which financial reports are prepared, usually quarterly or annually.

Prepaid Expense

Expenses paid in advance and recorded as assets before they are used or consumed.

Consumed

Consumed refers to the portion of resources, goods, or services that have been used up in the process of generating revenue.