Kittery Services,Inc

question 139

Multiple Choice

Kittery Services,Inc.purchased computers that are to be used in its consultancy services.Based on the matching principle,the related account that should appear on the income statement for the year ended December 31,2016 is ________.

• A)Depreciation Expense
• B)Service Revenue
• C)Accumulated Depreciation
• D)Equipment Expense

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Definitions:

Asset Account

An account that records the value of resources owned by an entity, which can provide future economic benefits.

Unearned Revenue

Money received by a company for goods or services yet to be provided; it is recorded as a liability until the service or product is delivered.

Adjusted

The process of making modifications to financial statements or data to represent accurately the economic reality, often excluding one-time or non-recurring items.

Prepaid Rent

An asset account that represents rent payments made in advance of the rental period, which is then expensed during the period the space is occupied or used.