If Invoices for Items Purchased Total $200,000 and Related Purchase

question 82

Multiple Choice

If invoices for items purchased total $200,000 and related purchase orders total $185,000, which of the following is correct?

• A) An encumbrance is debited for $200,000
• B) Reserve for encumbrances is credited for $200,000
• C) An expenditure is credited for $185,000
• D) A liability is credited for $200,000

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Definitions:

Fungi

A kingdom of complex organisms that obtain nutrients by breaking down organic material, including molds, yeast, and mushrooms.

Secondary Consumer

An organism that primarily eats primary consumers, which are herbivores that eat producers like plants and algae, situating it in the middle level of the food chain.

Organic Compound

A compound consisting of a backbone made up of carbon atoms.

Inorganic Compound

A simple substance that does not contain a carbon backbone.