Expenses That Fall Outside the Regular Operations of a Business

question 98

Multiple Choice

Expenses that fall outside the regular operations of a business are ________.

• A) generally a substantial part of net income
• B) recorded in the Owner, Capital account
• C) included under the other income and expenses section of the income statement
• D) not considered for the calculation of net income

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Definitions:

Cash Basis

An accounting method where revenues and expenses are recorded when cash is received or paid, not when they are incurred.

Property, Plant, Equipment

Tangible assets owned by a company used in operations and not intended for resale, such as buildings, machinery, and vehicles.

Cash Dividends

Distributions of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders in the form of cash.

Balance Sheet

A financial statement that summarizes a company’s assets, liabilities, and shareholders' equity at a specific point in time, providing a snapshot of its financial condition.