Adding Wages, Interest, Rent and Profits Yields

question 31

Multiple Choice

Adding wages, interest, rent and profits yields

• A) net domestic product at factor cost.
• B) total expenditure.
• C) gross domestic product.
• D) gross domestic product at factor cost.
• E) GNP.

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Definitions:

Ending Retained Earnings

The cumulative amount of a company's earnings not distributed to shareholders as dividends but retained by the company for reinvestment or to pay debt.

Stockholder Investments

Funds or assets that shareholders contribute to a corporation in exchange for ownership interest in the form of stock.

Dividends

Dividends refer to payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.

Expense Recognition

An accounting principle that matches expenses with revenues in the period in which the incurred expense contributes to revenue generation, regardless of when the cash transaction happens.