By Donating $1,000 to the Salvation Army,Caroline Reduces Her Taxable

question 330

Multiple Choice

By donating $1,000 to the Salvation Army,Caroline reduces her taxable income.To Caroline,the reduction in her taxable income is

• A) a marginal benefit.
• B) an opportunity cost.
• C) an incentive.
• D) a marginal cost.
• E) the margin.

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Definitions:

Average Daily Float

The average amount of uncollected funds in a company's checking account, representing checks written against and deposited in the account but not yet cleared.

Collection Float

The time period between when a payment is made by a customer and when the funds become available in the company’s account.

Cheques

Paper instruments that instruct a bank to pay a specific amount of money from the check writer's account to the person or entity in whose name the cheque has been issued.