Which of the Following Is an Example of a Deferral

question 8

Multiple Choice

Which of the following is an example of a deferral?

• A)Debit Salaries Expense,credit Salaries Payable
• B)Debit Accounts Receivable,credit Service Revenue
• C)Debit Property Taxes Expense,credit Property Taxes Payable
• D)Debit Insurance Expense,credit Prepaid Insurance

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Definitions:

Net Loss

The situation where a company's expenses exceed its revenues during a specific period, leading to a negative bottom line.

Statement of Stockholders' Equity

A financial statement that shows changes in the ownership interest of a company's shareholders, including contributions, distributions, and earnings.

Retained Earnings

The segment of net earnings that is not paid out as dividends but instead kept by the corporation for reinvestment in its primary operations or for debt repayment.

Prepaid Insurance

An asset account that reflects insurance premiums paid in advance, which are expensed as the insurance coverage periods expire.