Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct term.
-Paid-in capital
A)Cash received from a customer for goods or services to be provided in a future period.
B)Accumulated net income less dividends since the inception of the corporation.
C)Converting cash to inventory to receivables to cash.
D)Cash paid in advance for a cost of the company.
E)Amounts invested by shareholders in the corporation.

Question

Quizplus · Accepted Answer

Paid-in capital refers to the amounts invested by shareholders into the corporation.

Answer: B
 Retained earnings represent accumulated net income less dividends since the corporation was formed.

Answer: C
 This describes the operating cycle of a company, where cash is used to purchase inventory, which is converted to accounts receivable and ultimately back to cash.

Answer: A
 This refers to receiving cash from a customer in advance for goods or services that will be provided in the future.

Answer: D
 This refers to cash paid in advance for a cost that the company will incur in the future.

Listed Below Are Five Terms Followed by a List of Phrases