A Company Makes a Deferral Adjustment That Decreased a Liability

question 245

Multiple Choice

A company makes a deferral adjustment that decreased a liability.This must mean that a(n) :

• A) expense account was decreased by the same amount.
• B) expense account was increased by the same amount.
• C) revenue account was increased by the same amount.
• D) revenue account was decreased by the same amount.

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Definitions:

Marginal Product

The additional output generated by employing one more unit of a particular input, keeping other inputs constant.

Units of Labor

Measurements used to quantify the work input by labor forces, often referring to hours worked or number of workers.

Diminishing Returns

A principle stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.

Marginal Product Curve

A graphical representation that shows how the addition of one more unit of a resource to production affects the output of a product.