Which Accounts Are Affected When the Company Provides Services to a Cash

question 88

Multiple Choice

Which accounts are affected when the company provides services to a cash customer?

• A)Assets and Capital
• B)Liabilities and Capital
• C)Assets and Revenue
• D)None of the above are correct.

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Definitions:

Fractional Reserve Banking

A financial system where just a small portion of the deposits at a bank is supported by real cash present and accessible for withdrawal.

Fiat Money

Fiat money is currency that a government has declared to be legal tender, despite it not being backed by a physical commodity.

Precious Metal

Rare, naturally occurring metallic elements of high economic value, typically used for currency, jewelry, and other arts because of their rarity, durability, and aesthetic qualities.

Fiat Money

A form of money officially accepted as legal tender, not supported by a real commodity, as declared by authorities.