The Direct Write-Off Method Has One Advantage⎯it Is Very Simple

question 32

True/False

The direct write-off method has one advantage⎯it is very simple to apply.

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Definitions:

Net Operating Income

The amount a business earns after deducting its operational costs, not including taxes and interest expenses.

Variable Costing

An accounting method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in unit product costs.

Cost of Goods

The immediate expenses directly associated with manufacturing the products that a company sells.

Manufactured

The process of producing goods on a large scale using labor and machinery.