Explanation

The cost-benefit approach evaluates whether the benefits of an action or investment outweigh the associated costs.

It is commonly used in accounting and economics for decision-making to ensure efficiency and value.

Explanation

Retained earnings are profits kept in the company after paying dividends to shareholders.

They are reinvested in the business for growth, not distributed as cash.

Explanation

The formula for pricing preferred stock is:

Price = Dividend / Required Rate of Return

Since preferred dividends are usually fixed, there's no growth rate involved.

Explanation

Retained earnings involve no flotation or issuance costs, making them cheaper than raising funds through external equity.

External equity includes underwriting and administrative expenses, increasing its cost.

Explanation

A Sales Journal is a specialized accounting journal used to record all credit sales of goods.

It helps in organizing sales transactions systematically before posting them to the ledger.

Explanation

Standard costing, decision accounting, and budgetary control are important tools of management accounting.

Human Resources Accounting is generally considered separate from management accounting tools.

Explanation

Debenture holders receive fixed-rate interest as creditors.

They do not have voting rights or profit-sharing like shareholders.

Explanation

When fixed capital accounts are maintained, profits are credited to partners’ current accounts, not their fixed capital accounts.

This keeps the capital accounts unchanged while tracking profit shares separately.

Explanation

Debenture holders lend money to the company and receive interest, making them creditors.

They do not have ownership rights like shareholders.

Explanation

Gross National Product (GNP) includes the total domestic production plus net income earned from abroad.

It measures the economic output of a country's residents regardless of location.