Reference no: EM13356481

Choose the correct option in the question.

Choose the correct answer from the given option.

1. Cost of goods sold is an:

a.         asset

b.        liability

c.         revenue

d.        expense

2. An expense is recognized when:

a.         a business buys inventory

b.        a business buys supplies

c.         a business pays rent

d.        a business repays a loan

3. Accounts Receivable decreases when:

a.         goods are sold on credit

b.        goods are purchased on credit

c.         customers pay for goods previously purchased on credit

d.        a payment is made for goods purchased on credit

4. Accounts payable increases when:

a.         goods are sold on credit

b.        goods are purchased on credit

c.         customers pay for goods previously purchased on credit

d.        a payment is made for goods purchased on credit

5. Which of the following is an example of a fixed asset?

a.         building

b.        supplies

c.         inventory

d.        cash