Answer:
b. Both expenses & liabilities will be understated.
Explanation:
Accrual System of Accounting states that transactions should be recorded when they are entered into, irrespective of their cash settlement occurred r not.
Under Accrual Accounting System : Expense incurred but not yet paid , is an Outstanding Expense. It is recorded as an expense & a liability to be paid.
Journal Entry : Expense Dr to Expense Outstanding Cr
So, Not recording this 'Outstanding Expense' entry : leads to understatement of both expense & liability of that accounting period.
Answer: d. the firm's least expensive average total cost for any level of output
Explanation:
In the long-run, the company is expected to be able to solve whatever problems that is limiting its efficiency such that it is only able to produce at the cheapest costs possible.
The long-run average cost curve will therefore try to illustrate this by showing the least expensive average total cost for any level of output. Every point on the LRAC will be the lowest total cost associated with the level of output that it is graphed against.
Answer:
C.Implied warranty
Explanation:
An implied warranty is an assumed assurance that the product purchased is fit to function as intended. The implied warranty can be oral, written, or silent.
An implied warranty protects customers from dishonest traders. All products and some services carry an implied warranty, written or not. The warranty guarantees that the product conforms to the buyer's expectations. For example, if you buy a car, you expect the engine to start and the vehicle to move.
Frank has an implied warranty. He's expectations are the blind will work. Products with an implied warranty may also come with other forms of assurances such as express or full warranties.
Answer:
A. Applying different analytical approaches.
Explanation:
In decision making, it is advisable to apply different analytical approaches. In doing this, you are able to know the pros and cons of the different approaches.
This will thus help one narrow options for increased decision-making effectiveness.
Answer:
The accrual principle
The main purpose of adjusting entries is to update the accounts to conform with the accrual concept. At the end of the accounting period, some income and expenses may have not been recorded, taken up or updated; hence, there is a need to update the accounts.
