Answer:
c. debit to Interest Expense of $1,000.
Explanation:
The adjusting entry is as follows:
Interest expense Dr ($50,000 × 6% × 4 months ÷ 12 months) $1,000
To Interest payable $1,000
(Being the interest expense is recorded)
Here interest expense is debited as it increased the expense and credited the interest payable as it also increased the liabilities
Therefore the correct option is c.
Answer:
A. that involves double-counting.
Explanation:
Imagine a company that produces furniture. If we would include the wood, the nails, the wood paint, etc., were included in the calculation plus the furniture itself, you would be double-counting the cost of the manufactured furniture. If you consider waste materials, then you would be adding even more costs. That is why you only consider finished goods.
Answer:
c. courages investment by increasing the uncertainty about future returns
Explanation:
Inflation refers to the increase in the price level of the goods
The price inflation reflects that there is a rise in the price of the goods and services over a particular period of time lets say for one year. It can arise when the raw material cost during the process of production increased that push the price in upward
It also increased the uncertainty with respect to the future returns through investment
Hence, the correct option is c.
