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:

Permanent Tax

A concept in fiscal policy describing taxes that are intended to be implemented indefinitely or without a predetermined end date.

Aggregate Demand

The total market demand for goods and services within an economy at a fixed price level over a certain time period.

Crowding-Out Effect

The offset in aggregate demand that results when expansionary fiscal policy raises the interest rate and thereby reduces investment spending.

Government Spending

The total amount of money that a government expends on public services, social welfare programs, infrastructure, and defense, among other areas.