To Increase Efficiency

question 72

Multiple Choice

To increase efficiency,

• A)taxes are used to overcome both external benefits and external costs.
• B)subsidies are used to overcome both external benefits and external costs.
• C)subsidies are used to overcome external benefits,and taxes to overcome external costs.
• D)taxes are used to overcome external benefits,and subsidies to overcome external costs.
• E)public provision is used to overcome external benefits,and vouchers to overcome external costs.

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Definitions:

Process Costing System

A method of costing used where identical or similar items are produced in mass, costs are accumulated for a fixed period and assigned to all units produced.

FIFO Method

"First In, First Out" inventory valuation method where goods purchased or produced first are sold or used first.

Inventory Costing

A method used to assign costs to inventory items, which affects the cost of goods sold reported and the inventory's valuation on the balance sheet.

General Journal Entries

Accounting records that document all the financial transactions of a company, used to transfer information to the master ledger.