Which of the Following Must Be Included in the Calculation

question 28

Multiple Choice

Which of the following must be included in the calculation of GDP?

• A)The sale of a used car to an auto dealer
• B)Bartering lawn care services for car washes
• C)A father staying at home to attend to his child
• D)The sale of an illegal cable box
• E)Payment made for a SAT preparation class

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Definitions:

Prepaid Insurance

An asset account that represents insurance payments made in advance for coverage extending beyond the current accounting period.

Accounts Payable

Amounts owed by a business to its suppliers shown as a liability on a company’s balance sheet and typically due within a short period of time, often 30 to 90 days.

Equipment

Tangible assets used in the operations of a business, not intended for sale, and depreciated over time.

Drawing Account

An account that tracks the amount withdrawn by the owners from the business for personal use.