Which of the Following Costs Would Be Excluded from the Acquisition

question 101

Multiple Choice

Which of the following costs would be excluded from the acquisition cost of equipment purchased from a supplier?

• A) Cost to install the equipment.
• B) A purchases discount offered by the supplier.
• C) The cost of freight paid to get the equipment to our factory.
• D) The cost to widen an entrance in the building to bring the equipment into the facilities.

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Definitions:

Network Externality

The increase in the value of a good or service to an individual is greater when a large number of others own or use the same good or service.

Positive Externality

A beneficial effect experienced by a third party due to an economic activity, without compensation.

Socially Optimal

Refers to a state or condition in which resources are allocated in the most efficient manner from the perspective of society as a whole, maximizing overall well-being.

Market Quantity

Refers to the total amount of a particular good or service that is available for purchase in a market at a specific point in time.