When a Company Incurs Employee Salaries but Does Not Pay

question 71

Multiple Choice

When a company incurs employee salaries but does not pay them,how will the basic accounting equation be affected?

• A)Stockholders' equity decreases.
• B)Revenues decrease.
• C)Expenses decrease.
• D)Liabilities decrease.

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Definitions:

Units Requisitioned

Describes the quantity of inventory items requested or ordered for production or usage in a business operation.

Production

The process of creating, manufacturing, or enhancing goods and services through the combination of labor, materials, and machinery.

Direct Labor Hour

The amount of time spent by workers directly on the manufacturing of products or services.

Direct Labor

The expenses associated with the salaries of workers directly engaged in manufacturing products or providing services.