When the Amount of Revenue Collected in Advance Decreases During

question 1

Multiple Choice

When the amount of revenue collected in advance decreases during an accounting period:

• A) Accrual-basis revenues exceed cash collections from customers.
• B) Accrual-basis net income exceeds cash-basis net income.
• C) Accrual-basis revenues are less than cash collections from customers.
• D) Accrual-basis net income is less than cash-basis net income.

---

Definitions:

Corporate Officers

High-ranking executives appointed to manage an organization or corporation, such as CEOs, CFOs, and COOs, responsible for its day-to-day operations.

Employees

Individuals who are hired by a business or organization to perform work in exchange for compensation.

Duty to Reimburse

The obligation to pay back or compensate another party for expenses, losses, or damages incurred on one's behalf.

Authorized Expenditure

An approved expense deemed necessary and reasonable for the operation or management of a business or organization.