An Example of a Transposition Error Is Writing

question 4

Multiple Choice

An example of a transposition error is writing:

• A)$400 as $40
• B)$1,000 as $2,000
• C)$300 as $600
• D)$1,200 as $2,100

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Definitions:

Gross Profit

The difference between sales revenue and the cost of goods sold before deducting operating expenses, interest, and taxes.

Deferred Gross Profit

Income that is earned but not yet realized, often used in installment sales to represent profit to be recognized in future accounting periods.

Unearned Franchise Fees

Fees received from franchisees that cannot be recognized as revenue until certain obligations are fulfilled by the franchisor, categorized as a liability on the balance sheet.

Notes Receivable

Financial assets representing amounts owed to a company by customers or other entities, typically resulting from sales or loans, that are evidenced by formal agreements.