Profit-Oriented Managers Will

question 22

Multiple Choice

Profit-oriented managers will:

• A) accept an alternative as long as incremental revenue less incremental cost is greater than zero.
• B) accept an alternative as long as incremental revenue less incremental cost is less than zero.
• C) accept an alternative as long as marginal revenue is positive.
• D) accept an alternative as long as incremental costs are negative.
• E) accept an alternative as long as incremental revenue less incremental cost is equal to zero.

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Definitions:

Periodic Inventory System

An inventory accounting system where updates to inventory levels are made periodically at the end of accounting periods, rather than after each sale or purchase.

Average Cost Method

An inventory costing method that assigns the average cost of all similar items in inventory to the cost of goods sold and to ending inventory.

Cost Of Goods Sold

Represents the direct costs attributable to the production of the goods sold in a company, including materials and labor.

Ending Inventory

The total value of goods available for sale at the end of an accounting period.