Question

A discretionary account is: Group of answer choices

A. An income statement account that does not change with sales when management takes a specific action.

B. An income statement account that does not change with sales but is set by a management decision.

C. A balance sheet account that does not change with sales when management takes a specific action.

D. A balance sheet account that does not change with sales but is set by a management decision.

Answer 1

A discretionary account is A balance sheet account that does not change with sales but is set by a management decision.

Discretionary accounts include accounts such as common and preferred stock, bonds payable,investment in securities.

These balance sheet accounts are not affected by sales.

Option D is correct