The Two Types of Contracts Named for the Point at Which

question 40

Multiple Choice

The two types of contracts named for the point at which responsibility for loss is transferred from seller to buyer is:

• A) Point of import, point of export.
• B) Origination, destination.
• C) Destination, shipment.
• D) None of the above; the seller always assumes the risk of shipment.

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Definitions:

Five-day Week

A common work schedule that consists of five working days, usually Monday through Friday, followed by a two-day weekend.

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, recognizing the decrease in the value of the asset over time.

Adjusting Entry

An accounting entry made at the end of a period to assign income and expenses to the period in which they actually occurred.

Equipment

Tangible assets used in operations, such as machinery or office hardware, that have a useful life longer than one reporting period.