Elm City Issued a Purchase Order for Supplies with an Estimated

question 34

Multiple Choice

Elm City issued a purchase order for supplies with an estimated cost of $5,000.When the supplies were received,the accompanying invoice indicated an actual price of $4,950.What amount should Elm debit (credit) to the budgetary fund balance account after the supplies and invoice were received?

• A) $4,950
• B) ($50)
• C) $50
• D) $5,000

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Definitions:

Corporate Earnings

The profit a company makes after deducting its operating expenses and taxes, indicative of its financial health.

Adequacy

The sufficiency or appropriateness of something to fulfill a specific need, requirement, or condition.

Fraudulent

Involving deception, typically for personal gain or to damage another individual, often considered a white-collar crime.

Preemptive Rights

Rights that give existing shareholders the option to buy additional shares before the company offers them to the public, to maintain their proportionate ownership.