Which One of the Following Transactions Will Ultimately Cause a Decrease

question 36

Multiple Choice

Which one of the following transactions will ultimately cause a decrease in retained earnings?

• A) Payment of the current month's telephone bill
• B) Collection of cash from a customer for services provided in the current month
• C) Payment of the prior month's account payable balance
• D) Receipt of interest on a note receivable

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Definitions:

Caterpillars

The larval stage of butterflies and moths, known for their voracious appetite before transitioning into pupae.

Sufficient Condition

A condition or set of conditions that, if met, guarantees that a certain state or event will occur, though it may not be necessary for the occurrence.

Causal Factor

A condition or event that directly influences the occurrence of another event or condition, serving as its cause.

Necessary Condition

A condition that must be present for an event or action to occur.