Which of the Following Terms Involves Calculating the Difference in Revenue

question 62

Multiple Choice

Which of the following terms involves calculating the difference in revenue and the difference in cost between decision alternatives?

• A)Budgeting production
• B)Incremental analysis
• C)Profit planning
• D)Systems development

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Definitions:

Equivalent Units

A concept used in cost accounting to represent the amount of work done on partially completed goods, expressed in terms of fully completed units.

First-in

A reference often used in inventory management, indicating that the first items produced or acquired are the first ones to be sold or used.

Materials

Substances or components used in the manufacturing or production of goods.

Equivalent Unit

A measure used in process costing that converts partially completed units into a number of fully completed units for accounting purposes.