Which of the Following Statements Is False

question 4

Multiple Choice

Which of the following statements is false?

• A) Payment for inventory not sold until the next period, is an example of a payment of cash which is not an expense
• B) Borrowing money is an example of a receipt of cash which is not revenue
• C) Discount allowed to customers for prompt payment, is an expense that is treated as a payment of cash
• D) Depreciation is an expense which is not a payment of cash

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Definitions:

Pricing Strategy

An approach or plan used by a business to determine the best price for its products or services to maximize profits and meet market demands.

Oligopoly

A market structure characterized by a small number of firms controlling a large portion of the market share, leading to limited competition.

Marginal Cost

Marginal cost refers to the variation in total production expenses when there is an increase of one unit in the quantity produced.

Marginal Revenue

The change in total revenue that results from the sale of 1 additional unit of a firm’s product; equal to the change in total revenue divided by the change in the quantity of the product sold.