In Year 1, Dale Company Incurred $4,000 of Utility Expense

question 109

Multiple Choice

In Year 1, Dale Company incurred $4,000 of utility expense on account. Dale paid cash for these expenses in Year 2. Which of the following shows how paying cash for Year 1's utility expense will affect Dale's accounting equation in Year 2?

• A)Option A
• B)Option B
• C)Option C
• D)Option D

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Definitions:

Processing Cost

The expenses associated with the operation needed to convert raw materials into finished products.

Disposal Cost

Expenses associated with the process of disposing of waste, obsolete inventory, or equipment, including transportation, recycling, or landfill fees.

Revenue Retrieval

The process of getting back revenue that has been lost or unaccounted for through various recovery efforts or strategies.

Resale Revenue

Income generated from selling goods or services that were previously purchased.