In the Accounting Equation, Assets Are Equal To

question 14

Multiple Choice

In the accounting equation, assets are equal to:

• A) liabilities plus owners' equity.
• B) liabilities divided by gross profit.
• C) stockholders' equity subtracted from liabilities.
• D) owners' equity multiplied by net income.

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Definitions:

Direct Materials

Raw materials that are directly attributable to the product being manufactured and can be easily identified and measured.

Budgeted Production

The planning of how many units of a product a company aims to produce within a specific period.

Activity-based Budgeting

A budgeting approach based on the activities that incur costs within an organization, focusing on managing business activities that drive costs.

Master Budget

Master budget is a comprehensive financial planning document that consolidates all of a company’s individual budgets related to sales, production, manpower, etc.