If the End of the Fiscal Year Is Not a Payroll

question 40

Multiple Choice

If the end of the fiscal year is not a payroll date,the Direct Labor account normally has:

• A)A debit balance,representing prepaid labor costs.
• B)A credit balance,representing accrued wages payable.
• C)Either a debit or a credit balance,depending upon whether the end of the fiscal year falls before or after the end of the pay period.
• D)A zero balance,because the Direct Labor account is closed along with the other expense accounts.

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Definitions:

Medium of Exchange

Any item that is widely accepted in exchange for goods and services, thus facilitating trade by eliminating the need for a double coincidence of wants.

Inflation Rate

The percentage rate at which the general level of prices for goods and services is rising, and, subsequently, purchasing power is falling.

Velocity of Money

The rate at which money circulates in the economy, often used to gauge the health and vitality of economic activity.

Velocity of Money

The rate at which money is exchanged in an economy, highlighting how frequently a unit of currency circulates in a given time period.