A Newspaper Ad for a Local Toy Store Indicates That

question 33

Multiple Choice

A newspaper ad for a local toy store indicates that a very inexpensive microscope available for a small child is able to magnify specimens nearly as much as the much more costly microscope available in your college lab. What is the primary reason for the price difference?

• A) The ad agency is misrepresenting the ability of the toy microscope to magnify.
• B) The toy microscope does not have the same fine control for focus of the specimen.
• C) The toy microscope magnifies a good deal, but has low resolution and therefore poor quality images.
• D) The college microscope produces greater contrast in the specimens.
• E) The toy microscope usually uses a different wavelength of light source.

---

Definitions:

Accrued Revenues

Revenues that have been earned but not yet received in cash or recorded at the statement date, common in service-related transactions.

Adjusting Entry

An accounting entry made in the books at the end of an accounting period to allocate revenues and expenditures to the period in which they actually occurred.

Accrued Expenses

Expenses that have been incurred but not yet paid or recorded in the financial statements, representing future obligations.

Accrued Revenue

Revenue that has been earned but not yet received in cash or recorded by the accounting system.