When a Deferral Adjustment Is Made to an Asset Account,that

question 67

Multiple Choice

When a deferral adjustment is made to an asset account,that asset becomes a(n) :

• A) liability.
• B) other asset.
• C) revenue.
• D) expense.

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Definitions:

Operating Income

A measure of a company's profitability that excludes non-operating income and expenses, focusing on core business activities.

Fixed Costs

Expenses that remain constant regardless of the business's production or sales activity, including insurance and lease payments.

Variable Cost

Expenses that vary directly with the production output, including costs of raw materials and direct labor.

Selling Price

The amount of money for which a product or service is sold to customers.