An Annuity Stream of Cash flOw Payments Is a Set

question 101

Multiple Choice

An annuity stream of cash flow payments is a set of:

• A)level cash flows occurring each time period for a fixed length of time.
• B)level cash flows occurring each time period forever.
• C)increasing cash flows occurring each time period for a fixed length of time.
• D)increasing cash flows occurring each time period forever.
• E)arbitrary cash flows occurring each time period for no more than 10 years.

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Definitions:

Season Tickets

Prepaid tickets allowing entry to a series of events, typically for sports or theatrical seasons, offering a discount over purchasing individually.

Magazine Subscriptions

Recurring payments made by the readers to receive periodic publications over a specific period of time.

Supplies Expense

The cost associated with the consumption of supplies used in the operation of a business.

Adjusting Entry

A journal entry made at the end of an accounting period to allocate income and expenditure to the appropriate period.