Inflation Means That

question 48

Multiple Choice

Inflation means that:

• A)all prices are rising, but at different rates
• B)all prices are rising, and at the same rate
• C)prices are rising in general, although some particular prices may be falling
• D)real incomes are rising
• E)real incomes are falling

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Definitions:

Book of Original Entry

The Book of Original Entry refers to the initial record where financial transactions are documented chronologically.

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts, thereby resetting the temporary accounts for the next period.

Account Balances

The amount of money in an account at a specific point in time, reflecting all transactions.

Credits

An accounting entry that either decreases assets or increases liabilities and equity on the company's balance sheet.