Suppose You Have Purchased a Nonrefundable Plane Ticket And,at the Last

question 28

Multiple Choice

Suppose you have purchased a nonrefundable plane ticket and,at the last moment,cannot take the trip.You can,however,sell the ticket.If you paid $700 for the ticket,the cost of sending the ticket to someone through overnight mail is $20,and you spend $10 on a courier to get the ticket to the post office for overnight delivery,what is the minimum you should accept for the ticket?

• A)$700 because that is what the ticket cost
• B)$720 because that is the cost of the ticket and of getting it to the buyer
• C)$730 because that is the total cost of the ticket and getting it to the buyer
• D)More than $730,so that you can make a profit
• E)$30 because the $700 is a sunk cost

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Definitions:

Rent Expense

An accounting term that refers to the cost incurred by a company to utilize property or equipment for business operations, typically recognized over the lease term.

Adjusting Entry

An entry made in the books of accounts to correct or allocate incomes and expenditures to the appropriate accounting periods.

Debit

A financial record that leads to a rise in a company's assets or a reduction in its liabilities on the balance sheet.

Credit

An accounting entry that increases liabilities or equity or decreases an asset or expense.