Consider the Following Transactions: Issued Common Stock for Cash

question 132

Multiple Choice

Consider the following transactions: Issued common stock for cash.
Purchased equipment by signing a note payable.
Paid rent for the current month.
Collected cash from customers on account.
How many of these four transactions increased the given company's total assets?

• A) One.
• B) Two.
• C) Three.
• D) Four.

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Definitions:

Finished Goods

Items that are fully manufactured but remain unsold to consumers.

Conversion Costs

Costs associated with converting raw materials into finished products, which typically include both direct labor costs and manufacturing overhead costs.

Factory Overhead Costs

Indirect costs associated with manufacturing, including expenses related to running the factory but not directly traceable to individual products.

Indirect Labor Costs

The expense associated with labor that supports but does not directly contribute to the production or provision of services.