Which of the Following Transactions and Events Results in a Decrease

question 73

Multiple Choice

Which of the following transactions and events results in a decrease in both total assets and net income?

• A)The accrual of wages expense at year-end.
• B)Collecting cash from an account receivable.
• C)Recognizing previously recorded deferred revenue as revenue.
• D)Adjustment of the prepaid rent account for rent used during the perioD.Adjusting prepaid rent for rent used during the period reduces the prepaid rent (asset) account and recognizes a rent expense.The rent expense decreases net income.

---

Definitions:

Bond Price

The market value of a bond, which fluctuates based on interest rates, the bond's credit quality, and other factors.

Par Value Bond

A par value bond is a bond that is issued at its face value, and the amount that is paid back to the bondholder at maturity.

Coupon Rate

The interest rate stated on a bond when it's issued, which represents the annual interest payment made to bondholders.

Modified Duration

A measure of the sensitivity of the price of a bond or other debt instrument to changes in interest rates, adjusted for the bond's yield.