Because of Automation Which Component of Product Cost Is Declining

question 25

Multiple Choice

Because of automation which component of product cost is declining?

• A) Direct labor
• B) Direct materials
• C) Manufacturing overhead
• D) Advertising

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Definitions:

Note Payable

A written promise to pay a specific amount of money, usually with interest, by a certain date.

Borrower

An individual or entity that takes money or property from another under an agreement to return it or its equivalent at a future date.

Creditor

An entity or person to whom money is owed by a debtor for goods supplied or loans given.

Discount Rate

The discount rate is the interest rate used in calculating the present value of future cash flows, often reflecting the risk and time value of money in investment appraisals.