Which of the Following Statements Is Incorrect

question 9

Multiple Choice

Which of the following statements is incorrect?

• A) The normal balance of accounts receivable is a debit.
• B) The normal balance of owner's withdrawals is a debit.
• C) The normal balance of unearned revenues is a credit.
• D) The normal balance of an expense account is a credit.
• E) The normal balance of the owner's capital account is a credit.

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Definitions:

Activity Base

A measure used in costing that is a significant and quantifiable activity or event, determining the cost incurred by an activity.

Level Of Activity

A measure of the volume of production or work that a business operates at, which can affect costs and efficiency.

Variable Costs

Expenses that vary directly with the amount of production or the degree of business operations.

Fixed Costs

Expenses that do not change with the level of production or sales over a certain period, such as rent or salaries.