Raymond Finds Out That the City of Mornady Has a Contract

question 45

Multiple Choice

Raymond finds out that the city of Mornady has a contract with ACME company to pave the streets in front of his house. Paving the street will increase the value of his property. Raymond would be a[n] ________ beneficiary to the contract.

• A) donee
• B) creditor
• C) incidental
• D) accidental
• E) negligent

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Definitions:

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts to prepare the books for the next period.

Adjusting Entries

Journal entries made in accounting to update the records for expenses and revenues that have accrued but not yet been recorded.

Unadjusted Trial Balance

A listing of all the accounts and their balances from the ledger, before any adjusting entries are made for preparing financial statements.

End-of-period Spreadsheets

Summarizing documents prepared at the end of an accounting period that compile balances from ledgers for financial reporting.