An Account Linked with Another Account That Has an Opposite

question 143

Multiple Choice

An account linked with another account that has an opposite normal balance and that is subtracted from the balance of the related account is a(n) :

• A) Accrued expense.
• B) Contra account.
• C) Accrued revenue.
• D) Intangible asset.
• E) Adjunct account.

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Definitions:

AFC

Average Fixed Cost, the fixed costs of production divided by the quantity of output produced.

Variable Costs

Costs that change in proportion to the good or service that a business produces, such as materials and labor.

Output

The sum of all products or services generated by a business or economic system.

Market Price

The current value at which an asset or service can be bought or sold, determined by supply and demand forces in the open market.