At the End of Its First Month of Operations, Michael's

question 74

Multiple Choice

At the end of its first month of operations, Michael's Consulting Services, Inc. reported net income of $25,000. They also had account balances of: Cash, $18,000; Office Supplies, $2,000 and Accounts Receivable $10,000. The stockholders' total investment for this first month was $5,000. Calculate the ending balance in Stockholders' Equity to be reported on the Balance Sheet.

• A)$30,000
• B)$25,000
• C)$20,000
• D)$5,000
• E)$7,000

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Definitions:

Unemployment

A situation where individuals who are capable of working and willing to work cannot find employment.

Inefficiently Allocates

Describes a scenario where resources are not distributed or utilized in the most effective manner, leading to potential waste or misallocation.

Production Possibilities Frontier

A graph that shows the highest potential production levels for two or more products based on available resources.

Full Employment

Full employment refers to the condition in which all available labor resources are being used in the most efficient way possible, minimizing unemployment to only frictional or structural levels.