For Flexible Resources, Which of the Following Statements Is True

question 55

Multiple Choice

For flexible resources, which of the following statements is true?

• A)A change in resource spending will only occur if the demand for a resource drops permanently and exceeds demand enough so the activity capacity will be reduced.
• B)Often, resources are acquired in advance for multiple periods and are therefore irrelevant.
• C)Decisions often affect multi-period capabilities.
• D)If the demand for an activity changes across alternatives, then resource spending will change and the cost of the activity will be relevant to the decision.

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Definitions:

Closing Entry

An accounting action that transfers the balances from temporary accounts to permanent ones at the end of an accounting period.

Owner's Equity

The residual interest in the assets of an enterprise after deducting its liabilities; represents the owner's claims against the company's assets.

Income Summary

An account to which the revenues and expenses are transferred in order to calculate the net income for the period, ultimately transferring to retained earnings.

Accounting Cycle

The series of steps followed by an entity to collect, process, and report financial information, culminating in the preparation of financial statements for a specific period.