Frank and Marion,husband and Wife,file Separate Returns

question 44

Multiple Choice

Frank and Marion,husband and wife,file separate returns.Frank and Marion live in a common law state.Frank's salary is $42,000 and Marion's salary is $46,000.Marion receives dividend income of $4,000 from stock inherited from her parents.Frank receives interest income of $1,000 from bonds purchased with his salary after marriage.Frank and Marion receive $3,200 dividend income from stock they purchased jointly.Marion's income would be

• A)$50,000.
• B)$50,100.
• C)$51,100.
• D)$51,600.

Understand the principles of cost allocations to products and departments.

Comprehend the basis and methods for allocating indirect costs.

Define and differentiate profit center, cost center, and investment center.

Understand and explain the concept of activity-based costing (ABC).

---

Definitions:

Direct Price Discrimination

A pricing strategy where a business charges different prices to different customers for the same product or service, based on willingness to pay.

Arbitrage

A means to defeat a price discrimination scheme; it occurs when low-value individuals are able to resell their lower-priced goods to the higher-value group.

Low-value Group

A segment of the market or population perceived to have less purchasing power or economic importance.

Direct Price Discrimination

A pricing strategy where a seller charges different prices to different customers for the same product or service, based explicitly on the customer's willingness to pay.