Which of the Following Transactions Would Immediately Increase a Company's

question 98

Multiple Choice

Which of the following transactions would immediately increase a company's return on assets ratio?

• A)Received cash from customers for goods sold to them on account last month.
• B)Borrowed cash from a local bank.
• C)Paid cash on accounts payable.
• D)Incurred expenses on account.

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Definitions:

Availability Heuristic

A cognitive bias where people make judgments about the likelihood of an event based on how easily examples come to mind.

Endowment Effect

A cognitive bias where individuals value an owned object higher than a similar object they do not own, often affecting decision-making and market outcomes.

Framing Effects

Framing effects are cognitive biases where an individual's choice is influenced by the way information is presented, rather than just the information itself.

System 1

An automatic, fast, and often unconscious way of thinking, as described in dual-process theories of cognition.