Marcia Has Four Savings Accounts

question 65

Multiple Choice

Marcia has four savings accounts.Which account has the largest balance?

• A)$100 deposited 1 year ago at an 8 percent interest rate
• B)$100 deposited 2 years ago at a 4 percent interest rate
• C)$100 deposited 4 years ago at a 2 percent interest rate
• D)$100 deposited 8 years ago at a 1 percent interest rate

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Definitions:

Periodic System

An inventory system where updates to inventory accounts are made periodically at the end of a reporting period, rather than continuously, often requiring physical counts.

Average Cost Method

An inventory valuation method that calculates the cost of goods sold and ending inventory value based on the average cost of all items in inventory.

Ending Inventory

The inventory that remains unsold at the end of an accounting period.

LIFO Method

An inventory valuation method where the last items produced or bought are the first ones to be expensed, leading to lower reported profits and taxes when prices are rising.