Which One of the Following Types of Costs Should Not

question 8

Multiple Choice

Which one of the following types of costs should not be included in the cost of a building?

• A)costs of remodeling and reconditioning
• B)excavation costs
• C)unanticipated costs resulting from the condition of the land
• D)unanticipated construction costs, such as strike or fire losses

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Definitions:

Operating Efficiency

The effectiveness with which a company utilizes its assets and resources to generate profits and minimize costs without sacrificing quality.

Financial Statements

Formal records that outline the financial activities and condition of a business, including the balance sheet, income statement, and cash flow statement.

Acquisition

The process of obtaining control of another company or business entity through purchase or merger.

Receivable Turnover

A financial metric that measures how effectively a company is collecting on its receivables, calculated as sales divided by the average accounts receivable.