Use This End-Of-Period Spreadsheet to Answer the Questions That Follow

question 196

Multiple Choice

Use this end-of-period spreadsheet to answer the questions that follow.
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-The entry to close the dividends account would be

• A) debit Retained Earnings, $3,000; credit Dividends, $3,000
• B) debit Retained Earnings, $12,000; credit Dividends, $12,000
• C) debit Dividends, $3,000; credit Retained Earnings, $3,000
• D) debit Dividends, $12,000; credit Retained Earnings, $12,000

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Definitions:

Risk-averse

A characteristic of preferring to avoid loss over making a gain, typically by selecting the option with the smallest possible risk.

Expected Utility

A theory in economics that quantifies how choices are made when the outcomes are uncertain.

Utility

A measure of satisfaction or pleasure that individuals get from the consumption of goods and services.

Risk Premium

The extra return expected by investors for holding a risky asset over a risk-free one, serving as compensation for the additional risk.