The Recording of Interest Earned on an Account Balance or Wages

question 8

Multiple Choice

The recording of interest earned on an account balance or wages payable is an example of which type of adjusting journal entry?

• A)accrual entry
• B)deferral entry
• C)revaluation entry
• D)correcting entry

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Definitions:

R&D Expenditures

Funds allocated by a government, corporation, or other entity towards research and development activities aimed at innovating and improving products or processes.

Interest-Rate Cost-Of-Funds

The expense associated with borrowing funds, often determined by the interest rate at which money is borrowed.

Expected-Rate-Of-Return

The anticipated percentage of profit or loss an investment is likely to generate.

Immediate Costs

Expenses that are directly incurred and need to be paid out in the short term.