At the Time the Transaction Occurred,which of the Following Would

question 172

Multiple Choice

At the time the transaction occurred,which of the following would result in an increase in net income under the accrual basis of accounting,but would not result in an increase in net income under cash basis accounting?

• A) purchase of supplies for cash
• B) performance of services on account
• C) use of supplies purchased earlier
• D) receipt of cash for services that were performed earlier on account

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Definitions:

Merchandise

Goods bought and sold in the course of business, typically in a retail environment.

Merchandise

Goods or products that are bought and sold in retail or wholesale markets.

Carrying Value

The book value of assets and liabilities on a company's balance sheet, calculated as the original cost minus accumulated depreciation or amortization.

Financing Activities

Transactions related to raising capital and repaying investors, including issuing equity, obtaining loans, and dividend payments, affecting the company's capital structure.