A Business Receives a Bill from One of Its Suppliers

question 57

Multiple Choice

A business receives a bill from one of its suppliers for services received. The business will pay the supplier next month. How does the receipt of the bill from the supplier affect the accounting equation of the business?

• A)Assets decrease; equity decrease.
• B)Liabilities increase; equity decrease.
• C)Assets increase; liabilities increase.
• D)Liabilities increase; equity increase.

Apply concepts of elasticity to real-world scenarios involving commodities and services.

Understand the relationship between demand elasticity and total revenue.

Comprehend the significance of cross-price elasticity of demand and its implications on goods being substitutes or complements.

Recognize the impact of income changes on the demand for goods and services, including distinguishing between normal and inferior goods.

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Definitions:

Original Cost

The initial cost of acquiring an asset or service, including all expenses related to the purchase.

Internal Control

Processes and procedures implemented by a company to safeguard its assets, enhance the reliability of its accounting records, promote efficient operations, and ensure compliance with laws and regulations.

Physical Count

A physical count involves manually counting the actual inventory to verify accuracy against inventory records, often used for audit purposes or to correct discrepancies.

Physical Count

The process of manually counting and verifying the quantities of inventory on hand at a specific point in time.