The Following Data Relate to Gorr Company for the Year

question 5

Multiple Choice

The following data relate to Gorr Company for the year ended December 31,2012.Gorr Company uses the accrual basis. $\begin{array}{llcc} \text {Sales for cash } &\$200,000 \\ \text {Sales for credit } &220,000\\ \text { Cost of inventory sold } &180,000\\ \text { Collections from customers } &300,000\\ \text { Purchases of inventory on credit} &190,000\\ \text { Payment for purchases} &180,000\\ \text {Selling expenses (accual basis) } &50,000\\ \text { Payment for selling expenses } &60,000\end{array}$
Which of the following represents income for Gorr Company for the year ended December 31,2010?

• A)$180,000
• B)$185,000
• C)$190,000
• D)$200,000
• E)None of the answers are correct.

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Definitions:

Monetary Policy

Actions of a central bank, currency board, or other regulatory authorities that determine the size and rate of growth of the money supply, which in turn affects interest rates.

Fiscal Policy

Government policies regarding taxation and spending that influence economic conditions.

Rational Expectations

The hypothesis that individuals form forecasts about the future based on all available information in an unbiased and logical manner.

Monetary

Pertaining to money, including aspects related to money supply, banking, and monetary policy used by a government to influence an economy.