The Three Primary Accounting Issues Associated with Accounts Receivable Are

question 7

Multiple Choice

The three primary accounting issues associated with accounts receivable are:

• A) valuation, disposing, and statement presentation.
• B) recognition, valuation, and statement presentation.
• C) revenue recognition, matching, and statement presentation.
• D) recognition, valuation, and disposing.

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Definitions:

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected variable overhead based on standard cost.

Materials Price Variance

The difference between the actual cost of raw materials and the standard or expected cost, multiplied by the quantity of materials purchased.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected (or budgeted) variable overhead based on a standard rate.

Labor Efficiency Variance

measures the difference between the actual labor hours used and the standard labor hours expected for the production achieved, indicating labor efficiency.