Use the Following to Answer Questions

question 248

Multiple Choice

Use the following to answer questions:
Figure: Basic Supply and Demand
-(Figure: Basic Supply and Demand) In the diagram, which of the following statements is TRUE?

• A) When the price is $3, the quantity demanded exceeds the quantity supplied by 60 units.
• B) When the price is $2, the quantity demanded exceeds the quantity supplied by 40 units.
• C) When the price is $4, the quantity demanded is less than the quantity supplied by 40 units.
• D) When the price is $2, there is a tendency for the price to rise in the future.

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Definitions:

Net Realizable Value

Net Realizable Value is the estimated selling price of goods minus the costs of their sale or completion, used to value inventory or accounts receivable in the context of impairments or realizable value considerations.

Normal Profit Margin

The average amount by which a company's sales exceed its cost of goods sold and operating expenses, representing a standard level of profit.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board (IASB) that serve as a global framework for how public companies prepare and disclose their financial statements.

Periodic Inventory System

An inventory accounting system where updates to the inventory account occur at specific intervals, such as monthly or annually, rather than continuously.