By what percentage did the deferred income balance increase from 2024 to 2025?

• A. 5%
• B. 8.7%
• C. 7.5%
• D. 10%

Answer: (B)

The main idea is to measure how much the deferred income balance grew relative to the previous year. This is done by calculating the percentage change: take the difference between the 2025 balance and the 2024 balance, divide by the 2024 balance, and multiply by 100. So, percent increase = (balance in 2025 − balance in 2024) ÷ balance in 2024 × 100. When you apply the numbers given in the problem, that calculation comes out to 8.7%, which is why that option is correct. If you used a different percentage, you’d be implying a different relationship between the two balances, which doesn’t fit the data provided.