Nancy O'Rode Starts a Consulting Business Called EducateMe

question 111

Multiple Choice

Nancy O'Rode starts a consulting business called EducateMe.On May 1,the company paid $1,200 cash for six months of insurance coverage beginning on June 1.How would EducateMe record this transaction?

• A)Debit Cash for $1,200 and credit Prepaid Insurance for $1,200.
• B)Debit Cash for $1,200 and credit Insurance Expense for $1,200
• C)Debit Insurance Expense for $1,200 and credit Cash for $1,200.
• D)Debit Prepaid Insurance for $1,200 and credit Cash for $1,200.
• E)Debit Cash for $1,200 and credit Common Stock for $1,200.

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Definitions:

Signal-Detection Theory

A theory that explores how decisions are made under conditions of uncertainty, typically in the context of detecting weak or ambiguous signals amidst noise.

Physical Intensity

Refers to the magnitude or strength of a physical quantity (e.g., sound, light).

Sensory Adaptation

The process by which sensory receptors become less sensitive to constant or unchanging stimuli over time.

Perceptual Set

A psychological framework that influences how we perceive and interpret sensory information based on our expectations, culture, and past experiences.