Which of the Following Statements Is(are) True

question 31

Multiple Choice

Which of the following statements is(are) true?
(A) If variances are prorated at the end of the accounting period, an unfavorable direct materials price variance will, when prorated, increase the value of the Finished Goods Inventory.
(B) Insignificant variances are not generally prorated at the end of the accounting period and are closed to the Cost of Goods Sold.

• A) Only A is true.
• B) Only B is true.
• C) Both of these are true.
• D) Neither of these is true.

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Definitions:

Product Differentiation

The practice of distinguishing a product or service from others, to make it more attractive to a particular target market.

Demand Curves

Graphical representations showing the relationship between the price of a good and the quantity demanded by consumers.

Competitive Price-searcher

A market structure where firms have some degree of market power and set prices above marginal costs but must consider competitors' prices to attract consumers.

Market Exit

Market exit involves a company or business ceasing operations or leaving a particular market or industry.