Which of the following events (transactions) is an internal event for a business entity?
A) An accountant provides services for clients.
B) An accountant purchases computer equipment to maintain business records and prepare legal documents.
C) An accountant receives cash payments from clients for services performed.
D) Periodically, part of the cost of the computer equipment used by an accountant is assigned to depreciation expenses.

Question

Quizplus · Accepted Answer

Depreciation expenses are an internal transaction because it involves the company's assets (the computer equipment) and its accounting records, but does not involve any external party. The other options involve either providing services to clients (A) or purchasing equipment (B), or receiving cash payments from clients (C), which are all external transactions that involve parties outside of the business entity.

Which of the Following Events (Transactions) Is an Internal Event