The Major Difference in the Balance Sheet Between a Service

question 38

Multiple Choice

The major difference in the Balance Sheet between a service business and a merchandising business is:

• A)that the Balance Sheet of a merchandising business includes Equipment as a current asset.
• B)that the Balance Sheet of a merchandising business includes Prepaid Expenses as a long-term asset.
• C)that the Balance Sheet of a merchandising business includes Inventory as a current asset.
• D)nothing. There are no differences between the two.

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Definitions:

Mental Shortcuts

Cognitive strategies that simplify decision making by reducing the amount of information processed.

Cognitive Misers

A theory suggesting that humans, in an effort to conserve mental energy, prefer to rely on simple and efficient thought processes rather than engaging in more effortful and complex reasoning.

Judgements

Judgements are opinions or decisions formed after considering facts and evidence, often involving the evaluation of information to draw conclusions.

Emotional Relating

The process of connecting with others through emotions, empathizing with their feelings, and expressing one's emotional state.