Which of the Following Transactions Would Cause Net Income for the Period

question 99

Multiple Choice

Which of the following transactions would cause net income for the period to decrease?

• A) Paid $2,500 cash for raw material cost
• B) Purchased $8,000 of merchandise inventory
• C) Recorded $5,000 of depreciation on production equipment
• D) Used $2,000 of office supplies

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Definitions:

Inelastic

Describes a situation where the demand or supply for a good or service is relatively unaffected by changes in price.

Price Elasticity of Demand

A measure of how responsive the quantity demanded of a good is to a change in its price, often used to gauge the relative change in demand as a result of price fluctuations.

Soccer Balls

Spherical balls designed and used specifically for the sport of soccer.

Quantity Demanded

The aggregate quantity of a product or service that buyers are ready and capable of buying at a specific price point.