The Following Accounts and Balances Were Drawn from the Records

question 68

Multiple Choice

The following accounts and balances were drawn from the records of Hoover Company on December 31, 2013: $$\begin{array} { l r l r } \text { Cash } & \$ 1,000 & \text { Accounts Receivable } & \$ 850 \\\text { Dividends } & 500 & \text { Common Stock } & 975 \\\text { Land } & 800 & \text { Revenue } & 800 \\\text { Accounts Payable } & 450 & \text { Expense } & 550\end{array}$$ The amount of retained earnings as of January 1, 2014 was:

• A) $1,475.
• B) $1,800.
• C) $975.
• D) $1,225.

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Definitions:

Price Elasticity Coefficient

A measure used in economics to show how the quantity demanded of a good or service responds to a change in its price, calculated as the percentage change in quantity demanded divided by the percentage change in price.

Elastic

Describes a situation where the demand or supply of a good or service is sensitive to changes in price.

Perfectly Elastic

A situation where the quantity demanded or supplied changes infinitely in response to any change in price.

Total Revenue

The overall income generated by a business through the sale of goods or the delivery of services within a certain period.