On June 30 of the Current Calendar Year, Apricot Co

question 156

Multiple Choice

On June 30 of the current calendar year, Apricot Co. paid $7,500 cash for management services to be performed over a two-year period. Apricot follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The adjusting entry on December 31 for Apricot would include:

• A) A debit to an expense for $5,625.
• B) A debit to a prepaid expense for $5,625.
• C) A debit to an expense for $1,875.
• D) A debit to a prepaid expense for $1,875.
• E) A credit to a liability for $1,875.

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Definitions:

Longitudinal

Pertains to research or studies that collect data from the same subjects repeatedly over a period of time to observe changes and developments.

Cross-sectional

A type of study or analysis that examines a population, or a representative subset, at a specific point in time.

Univariate

Pertaining to an analysis or statistical evaluation that involves only one variable.

Multivariate

Pertaining to or involving multiple variables or elements.