Which of the Following Transactions Will Not Result in the Recognition

question 152

Multiple Choice

Which of the following transactions will not result in the recognition of an expense?

• A) Interest accrued on a bank loan
• B) A cash withdrawal by the owner
• C) Use of machinery during the period
• D) Expiration of prepaid insurance

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Definitions:

Individual Rights Principle

An ethical guideline that stresses the importance of respecting and protecting the rights of individuals in decision-making processes.

Persistence

The quality of continuing firmly or obstinately in a course of action in spite of difficulty or opposition.

Direction

Guidance or supervision provided to achieve a goal or follow a particular course of action; often implies leadership or the process of setting goals.

Intensity

The degree of strength, force, or energy with which an action is executed or a characteristic is manifested.