When Two Companies Merge, the Length-Of-Service Principle of Combining Seniority

question 32

Multiple Choice

When two companies merge, the Length-of-Service Principle of combining seniority lists prescribes that:

• A) Employees' length of service is considered regardless of which company they worked for previously; the two lists are combined as one.
• B) Employees are given rank positions on the merged lists equal to their rank position on their prior list.
• C) Employees of the acquired company are added to the bottom of the list of the acquiring company.
• D) Employees are allowed to continue previously earned seniority on separate seniority lists.

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Definitions:

Prepaid Insurance

Payments made for insurance coverage that has not yet been incurred, recorded as an asset on the balance sheet.

Supplies Account

An account used in accounting to track the amount spent on supplies that are used in the business operations.

Accounting System

A systematic process of collecting, recording, classifying, summarizing, and interpreting financial transactions of a business.

Purchases Journal

The purchases journal is an accounting record used to document all purchases of merchandise on credit, tracking the total amount owed to suppliers.