Four of the Five Statements Below Contain a Stock and a Flow.Which

question 55

Multiple Choice

Four of the five statements below contain a stock and a flow.Which statement describes ONLY stock variables OR flow variables?

• A)Chris earns $1500 per month and has $4000 in his savings account at the bank.
• B)Nancy spends $400 per month on her credit card and has a balance owing of $2567.
• C)The Transit Authority of Mytown collects $22 000 in fares per day and has an operating budget of $2 million per year.
• D)Country X spends an average of $1 million per year for flood relief and has an emergency services fund of $20 million.
• E)The Canadian Federal government has a debt of approximately $450 billion and an annual deficit of over $25 billion dollars.

---

Definitions:

Allocation Sequence

The order or process by which costs or resources are distributed among various departments or projects.

Service Departments

Units within an organization that support other departments but do not directly contribute to the production of goods or delivery of primary services.

Reciprocal Method

A technique used in cost accounting to allocate service department costs to production departments by recognizing the interdependencies between service departments.

Direct Method

A means of allocating service department costs directly to production departments without apportioning them among service departments first.