When a Company Receives an Electric Bill but Does Not

question 187

Multiple Choice

When a company receives an electric bill but does not pay it right away,what is the required journal entry to be recorded?

• A) Utilities Expense - Debit; Accounts Receivable - Credit
• B) No entry is required until the bill is paid.
• C) Utilities Expense - Debit; Accounts Payable - Credit
• D) Accounts Payable - Debit; Utilities Expense - Credit

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Definitions:

Real World

A term referring to actual conditions and practical experiences in everyday life, as opposed to theoretical or simulated environments.

Automatic Dividend Reinvestment

A program that automatically uses dividends paid by investments to purchase more shares of those investments.

Homemade Dividend Policies

Investment strategies whereby investors create their own dividend stream by selling a portion of their portfolio of equities.

Stockholders

Individuals or entities that own shares in a corporation, thereby having partial ownership and potentially receiving dividends.