Proponents of Variable Costing Argue That Inventories Have Value Only

question 2

Multiple Choice

Proponents of variable costing argue that inventories have value only to the extent that they:

• A)avoid the necessity for incurring costs in the future.
• B)eliminate depreciation charges.
• C)can be sold for enough to cover costs and a reasonable profit.
• D)turn over in less than one year.

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Definitions:

Rescission

The revocation, cancellation, or repeal of a contract, returning all parties involved to their positions prior to the agreement.

Restitution

The act of compensating for loss, damage, or injury caused; involves returning to the original state or compensating for loss.

Breach Of Contract

Neglecting to comply with any aspect of a contract, documented or verbal, without a lawful excuse.

Rescission

The legal act of cancelling or terminating a contract, returning the parties, as much as possible, to their positions prior to entering the agreement.