The Major Balance Sheet Account in the Acquisition and Payment

question 94

Multiple Choice

The major balance sheet account in the acquisition and payment cycle is:

• A) accounts payable.
• B) ordinary shares.
• C) purchases.
• D) merchandise inventory.

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Definitions:

Unit of Measure Concept

An accounting principle that states all business transactions must be recorded in a single, consistent unit of measurement.

Financial Statements

Comprehensive reports that provide insights into a company's financial health, including balance sheets, income statements, and cash flow statements.

Manufacturing Companies

Businesses that produce finished goods from raw materials through the use of labor, machines, tools, and chemical or biological processing.

Cost Concept

An accounting principle that dictates that all assets are recorded and reported at their original purchase cost rather than their current market value.