Which of the Following Does Not Apply to a Seller

question 78

Multiple Choice

Which of the following does not apply to a seller who is a principal?

• A) Has control over goods or services
• B) Primarily responsible for providing goods or services to customer
• C) Exposed to risks associated with holding inventory
• D) Primary performance obligation is to facilitate the transfer of goods or services

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Definitions:

Balance Sheet

A document that captures the financial standing of a company at a certain date, outlining its assets, debts, and the equity held by shareholders.

Work Sheet

An informal document used by accountants during the accounting cycle to compile information from the general ledger for the preparation of financial statements and adjusting journal entries.

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts and prepare the company’s accounts for the next period.

General Journal

A comprehensive accounting record of all transactions made by a company, listed in chronological order and used in preparing financial statements.