Which Statement About Incomes Earned by Factors of Production Is

question 164

Multiple Choice

Which statement about incomes earned by factors of production is false?

• A)Land earns rent.
• B)Natural resources earn rent.
• C)Labour earns wages.
• D)Capital earns profit.
• E)Entrepreneurship earns profit.

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Definitions:

Unit Product Cost

The total cost associated with producing a single unit of a product, including direct materials, direct labor, and allocated overhead.

Absorption Costing

A method of inventory costing that includes all manufacturing costs, both variable and fixed, in the cost of a finished product.

Variable Costing

An economic recording tactic that involves only variable manufacturing costs (direct materials, direct labor, and variable manufacturing overhead) in determining product costs.

Income Statement

A financial statement that shows a company's revenues, expenses, and profits over a particular period, providing insights into its financial performance.