An Entry to Appropriate a Portion of Retained Earnings to Finance

question 76

Multiple Choice

An entry to appropriate a portion of retained earnings to finance a future plant expansion would include a debit to:

• A)Paid-in Capital in Excess of Par.
• B)Cash.
• C)Retained Earnings.
• D)Unappropriated Retained Earnings.

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Definitions:

Legitimate Power

A form of authority that is recognized and accepted by individuals because it stems from a position of responsibility in a hierarchy.

Referent Power

A form of influence based on the attraction or admiration one person has for another, often because of the latter's charisma or likability.

Coercive Power

Coercive power is the ability to control others through the threat of punishment or the imposition of unpleasant consequences.

Approach-Inhibition Model

A psychological theory that explains how power within social hierarchies can influence individuals’ behaviors, either encouraging or inhibiting actions.