What Was the Average Collection Period for 2018

question 400

Multiple Choice

What was the average collection period for 2018?

• A) 92 days
• B) 112 days
• C) 151 days
• D) 211 days
• E) 256 days

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Definitions:

Fixed Overhead

Fixed Overhead refers to the indirect costs of production that do not vary with the volume of production, such as salaries of managers, rent of factory, and depreciation of equipment.

Standard Cost System

A system of accounting that uses predetermined costs for calculating variances and tracking operational performance.

Job Order Cost System

A cost accounting system in which costs are assigned to each job or batch.

Overhead Volume Variance

The difference between the expected (budgeted) and actual overhead costs attributed to a change in production volume.