Which of the Four Sedimentary Layers in This Figure Is

question 2

Multiple Choice

Which of the four sedimentary layers in this figure is the oldest?

• A)the layer on top
• B)the layers in the middle
• C)the layer on bottom
• D)there is not enough information to tell

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Definitions:

Accrual

The accounting principle of recording revenues and expenses when they are incurred, regardless of when cash transactions occur.

Contra Asset

A balance sheet account used to reduce the value of related asset accounts to report their net value; examples include accumulated depreciation or allowance for doubtful accounts.

Prepayment

Payments made in advance for goods or services, recorded as an asset on the balance sheet until the corresponding goods or services are received.

Adjusting Entries

At the end of a financial period, entries are made in the books to correctly allocate profits and outlays to the period they belong to.