Table 23-4 -Refer to Table 23-4

question 182

Multiple Choice

Table 23-4
$$\begin{array} { | c | c | } \hline \begin{array} { c } \text { Consumption } \\\text { (dollars) }\end{array} & \begin{array} { c } \text { Disposable Income } \\\text { (dollars) }\end{array} \\\hline \$ 600 & \$ 1,000 \\\hline 900 & 1,500 \\\hline 1,200 & 2,000 \\\hline\end{array}$$
-Refer to Table 23-4.Given the consumption schedule in the table above,the marginal propensity to save is

• A)0.3.
• B)0.4.
• C)0.5.
• D)0.6.

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Definitions:

Permanent Accounts

The balance sheet accounts whose balances are carried over into future accounting periods, not closed at the end of the fiscal year.

Posting

The process of recording financial transactions to the appropriate accounts in the general ledger.

Adjusting Entries

Journal entries made in accounting records at the end of an accounting period to update the accounts for any accruals and deferrals that were not recorded during the accounting period.

Accounting Cycle

A series of steps performed during an accounting period, starting with recording transactions and ending with the preparation of financial statements.