Which of the Following Journal Entries Is Correct When a Business

question 41

Multiple Choice

Which of the following journal entries is correct when a business entity uses cash to pay an account payable?

• A) Accounts Payable
• \( \quad \) \( \quad \)Cash
• B) Retained Earnings
• \( \quad \) \( \quad \)Cash
• C) Cash
• \( \quad \)Accounts Payable
• D) Cash
• \( \quad \)Notes Payable

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Definitions:

Remoteness Test

A legal principle used to determine if the damage suffered from a breach of contract or tort was foreseeable and therefore compensable.

Negligence Action

A legal proceeding initiated because someone failed to take reasonable care, resulting in harm or damage to another.

Concert Pianist

A professional pianist who performs solo recitals, concertos with orchestras, and chamber music in concert halls.

Negligence

The failure to exercise the care that a reasonably prudent person would exercise in similar circumstances, resulting in harm or damage.