Figure 7-17 -Which of the Following Statements Must Be True When a Be

question 178

Multiple Choice

Figure 7-17

-Which of the following statements must be true when a firm makes choices that put it at point A in Figure 7-17?

• A)The firm is minimizing its cost of producing 100 units of output.
• B)The ratio of the marginal physical products of labor and of land equals the ratio of the prices of labor and of land.
• C)The firm first decided how much output to produce and then decided how to produce it.
• D)All of the above are true.

---

Definitions:

Intraperiod Tax Allocation

The process of allocating income taxes between different parts of the financial statements within the same fiscal period.

FASB Statement No.109

A standard issued by the Financial Accounting Standards Board relating to income tax accounting.

Installment Method

A revenue recognition method that allows income to be realized at the point of sale and subsequently as payments are received.

Revenue Recognition

Accounting principle that determines the specific conditions under which income becomes realized as revenue.