When a Person's Income Increases

question 130

Multiple Choice

When a person's income increases:

• A)more bundles of goods and services become affordable.
• B)fewer bundles of goods and services become affordable.
• C)there is no change in how many bundles of goods and services become affordable.
• D)more expensive bundles of goods and services become affordable.

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Definitions:

Accrue

The process in accounting by which revenues and expenses are recognized when incurred, regardless of when cash transactions occur.

Salaries Expense

The total amount spent by an organization on employee salaries over a specific period of time.

Salaries Payable

A liability account that records the amount of salaries owed to employees but not yet paid.

Accrued

Income earned or expenses incurred before cash has been exchanged, often recognized in the accounting process.