Which Are the Three Factors That Affect the Accounting Choices

question 30

Multiple Choice

Which are the three factors that affect the accounting choices made by management?

• A)Constraints, facts, GAAP, IFRS
• B)Constraints, facts, objectives
• C)IFRS, facts, legislation
• D)Facts, objectives, legislation

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Definitions:

Traditional Costing Method

A costing methodology that allocates factory overhead to products based on the volume of production resources they consume.

Activity-Based Costing

Activity-based costing is an accounting method that assigns costs to products or services based on the activities and resources that go into producing them.

Direct Labor-Hours

A quantification of the overall hours dedicated to the direct production of goods.

Unadjusted Cost

Refers to the original cost of an asset or expenditure without any adjustments for depreciation, taxation, or any other modifications.