On December 1,2014,Parsons Sales Sold Machinery to a Customer for $2,000.The

question 31

Multiple Choice

On December 1,2014,Parsons Sales sold machinery to a customer for $2,000.The customer could not pay at the time of sale,but agreed to pay 9 months later,and signed a 9-month note at 12% interest.How much interest revenue was earned during the year 2014?

• A) $180
• B) $75
• C) $20
• D) $90

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Definitions:

Deadweight Loss

The loss of economic efficiency that occurs when the equilibrium for a good or a service is not achieved or is not achievable, leading to a suboptimal allocation of resources.

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the price where supply and demand are equal.

Tax

An unavoidable fiscal exaction or different type of contribution enforced by a governmental faction on a taxpayer, intended to support the financing of governmental operations and a range of public service outlays.

Tax Revenue

The income governments procure through the levy of taxes.