Which of the Following Transactions Affects Both Retained Earnings and Net

question 40

Multiple Choice

Which of the following transactions affects both retained earnings and net income?

• A) The payment of a cash dividend.
• B) The recording of revenue for services provided.
• C)The issue of stock in exchange for cash.
• D)The borrowing of money from a bank.

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Definitions:

Subgoals

Smaller, achievable objectives set as steps that contribute towards the attainment of a larger goal.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to a person's mind when evaluating a specific topic, concept, method, or decision.

Representativeness Heuristic

A cognitive shortcut that involves making judgments based on how much one entity represents, or is similar to, another entity.

Insight

The capacity to gain an accurate and deep understanding of someone or something.