The True Statement Is

question 44

Multiple Choice

The true statement is:

• A)The profit of an entity is always represented by an increase in cash of the same amount.
• B)A withdrawal of cash for private use by the owner is shown in the income statement as an expense.
• C)Equity can be thought of as the owner's claim to the assets of the entity after deducting all liabilities.
• D)Profit can be calculated as; Net assets at the end of the year less net assets at the beginning of the year less drawings.

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Definitions:

Beneficiaries

Individuals or entities entitled to receive benefits or proceeds from an insurance policy, will, or trust.

Roth IRA

Deposits are taxable, but when the money is withdrawn after having been there for at least 5 years and the saver is at least 59 1/2 years old, the money and the income earned is tax-exempt, or free from all taxes.

Tax-Deferred

Taxes are paid at the time the money is withdrawn from the account, not when the money is actually earned.

Social Security Benefits

Payments made to eligible individuals (retirees, disabled workers, and their families) from the Social Security program, funded by Social Security taxes.