The Constructive Receipt Doctrine

question 136

Multiple Choice

The constructive receipt doctrine:

• A)is particularly restrictive for accrual-basis taxpayers.
• B)causes income to be recognized before it is actually received.
• C)causes income to be recognized after it is actually received.
• D)applies equally to income and expenses.
• E)None of the choices are correct.

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Definitions:

Normal Standards

Benchmarks or norms established for a business process or operation that are considered to be a typical or expected level of performance.

Total Manufacturing Cost Variance

The difference between actual manufacturing costs and the standard costs of those manufactured items.

Direct Labor Cost Variance

The difference between the budgeted or standard cost of direct labor and the actual cost incurred, used in variance analysis for cost control.

Factory Overhead Cost Variance

The difference between the actual overhead costs incurred and the expected (or standard) costs, relating to production.