First Ledger Inc

question 46

Multiple Choice

First Ledger Inc.,an auditing company,replaced its existing accounting software with new accounting software from another supplier.Since the new software has different features and abilities,First Ledger Inc.has had to spend $10,000 on training its employees to use it.In this scenario,$10,000 represents First Ledger Inc.'s

• A) opportunity cost.
• B) switching cost.
• C) octroi charge.
• D) excise duty.

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Definitions:

Rent Expense

The cost incurred by a business for leasing a property or equipment for operational purposes.

Income Summary

An account used in the closing process that summarizes the results of all revenue and expense accounts.

Capital

The wealth, whether in money or other assets, owned or employed in business by an individual, firm, or corporation.

Withdrawal Account

An account from which funds can be withdrawn by the account holder; in the context of business partnerships, it refers to an account used by an owner or partner to draw funds from the business.