Oklahoma Chemicals Plans to Use Its Computers to Post Information

question 225

Multiple Choice

Oklahoma Chemicals plans to use its computers to post information from journals to the ledger instantaneously.One obvious benefit of this technology is:

• A)A reduction in the number of accountants required by the firm.
• B)Less scrutiny from agencies such as the Internal Revenue Service.
• C)To shift financial decision making from people to programmed technology.
• D)Readily available financial information.

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Definitions:

Operations

Activities involved in the day-to-day running of a business for the purpose of producing value for the stakeholders.

Variable Costing

An accounting method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in the cost of goods sold.

Absorption Costing

A calculation approach that encompasses all expenses of production, such as materials, labor, and all overheads, both variable and fixed, in determining a product's price.

Variable Production Costs

Costs that vary directly with the level of production, such as raw materials and direct labor.