A Company Using the Accrual Basis of Accounting Receives Its

question 27

Multiple Choice

A company using the accrual basis of accounting receives its utility bill which will be paid in two weeks.The entry will involve a debit to:

• A) Utilities Expense
• B) Utilities Payable
• C) Prepaid Utilities
• D) Prepaid Revenue

---

Definitions:

Common Law

The body of law derived from judicial decisions of courts and similar tribunals, rather than from statutes or official codes.

Contracts

Legally binding agreements between two or more parties that are enforceable by law.

Restraint of Trade

Practices or agreements that restrict competition or control prices within a business context, often considered illegal or subject to regulation.

Sherman Act

A foundational antitrust law enacted in 1890 to combat anti-competitive practices, reduce market monopolies, and foster competition in the U.S. economy.