The Circular Flow Diagram Shows That the Flow of Payments

question 298

True/False

The circular flow diagram shows that the flow of payments to the factors used to produce goods and services exceeds the flow of payments for final goods and services.

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Definitions:

Worksheet

An informal document used within an accounting system to collate all data for financial statements preparation, aiding in the adjustment and closing process.

Merchandising Company

A business that sells finished goods to consumers, making profits through the buying and selling activities.

Inventory

The total of all goods available for sale or use, including raw materials, work-in-progress, and finished goods.

Perpetual Inventory

A system of accounting for inventory that records the sale or purchase of inventory immediately through computerized systems.