Which of the Following Is True If the Opportunity Cost

question 34

Multiple Choice

Which of the following is true if the opportunity cost of producing a particular good is less than its accounting profit?

• A)Economic profit is zero.
• B)Economic profit is negative.
• C)Economic profit is positive.
• D)Economic profit cannot be determined.

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Definitions:

Closing Entries

Entries recorded at the close of an accounting period to move balances from temporary to permanent accounts.

Adjusted Trial Balance

A list of all accounts and their balances after adjusting entries are made, used to prepare financial statements and ensure the ledger accounts are balanced.

Current Assets

Assets that a company expects to convert to cash or use up within one year or the operating cycle, whichever is longer.

Property, Plant, and Equipment

Long-term or relatively permanent tangible assets such as equipment, machinery, and buildings that are used in normal business operations.