Rick Recently Purchased a Convenience Store for $500,000

question 298

Multiple Choice

Rick recently purchased a convenience store for $500,000. He expects monthly profits to be $10,000 in the next year. If a recession had struck, Rick had instead paid $300,000, and his monthly
Profits were reduced to $6,000, his expected rate of return would have

• A) increased by 2 percentage points.
• B) increased by 3 percentage points.
• C) decreased by 2 percentage points.
• D) remained the same.

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Definitions:

Defective Merchandise

Goods that are damaged or below quality standards, often leading to returns, exchanges, or adjustments in sales and accounting records.

Miscellaneous Accounts

Miscellaneous Accounts are ledger accounts that capture financial transactions not classified under specific account headings, often used for incidental or occasional transactions.

Voucher Register

A record containing details about payment vouchers, including the payee, amount, date, and purpose of each payment.

Voucher Register

A record of all vouchers issued by a business, detailing payments made or to be made for goods or services.