In Its First Year of Operations, Grace Company Reports the Following

question 125

Multiple Choice

In its first year of operations, Grace Company reports the following: Earned revenues of $60,000 ($52,000 cash received from customers) ; Incurred expenses of $35,000 ($31,000 cash paid toward them) ; Prepaid $8,000 cash for costs that will not be expensed until next year. Net income under the cash basis of accounting is:

• A)$21,000.
• B)$13,000.
• C)$25,000.
• D)$17,000.
• E)None of the above.

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Definitions:

-pnea

is a suffix related to breathing, used in terms to describe different types of breathing patterns or conditions.

Prefix

In grammar, an affix placed before a word, base, or another prefix to modify a term's meaning.

Suffix

An affix placed at the end of a word to alter its meaning, often indicating tense, plurality, or part of speech in linguistics, or used to denote specificity in scientific terms.

Combining Form

A form of a word used in conjunction with another form to create medical terms.