Consider the Following Transactions

question 39

Multiple Choice

Consider the following transactions:

Which of the above transactions increase June 2016 expenses?

• A) (ii) only
• B) (i) and (ii) only
• C) (i), (ii) and (iii) only.
• D) (i), (ii) and (iv) only.

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Definitions:

Merchandise Sale

The transaction of selling goods that are purchased for resale by a business.

Promissory Note

A financial instrument containing a written promise by one party to pay another party a definite sum of money either on-demand or at a specified future date.

Promissory Note

A financial document in which one party promises in writing to pay a determinate sum of money to the other, either at a fixed or determinable future time or on demand of the payee, under specific terms.

Accrued Interest

The interest that has accumulated on a debt over a period of time but has not yet been paid.