Inventoriable Costs May Be Thought of as a Pool of Costs

question 87

Multiple Choice

Inventoriable costs may be thought of as a pool of costs consisting of which two elements?

• A) The cost of beginning inventory and the cost of ending inventory
• B) The cost of ending inventory and the cost of goods purchased during the year
• C) The cost of beginning inventory and the cost of goods purchased during the year
• D) The difference between the costs of goods purchased and the cost of goods sold during the year

---

Definitions:

Machine-hour

A unit of measure representing the operation of machinery for one hour, often used as a basis for allocating manufacturing overhead costs.

Job Cost

A method used in accounting to track the costs associated with a specific job or order, capturing materials, labor, and overhead expenses.

Predetermined Overhead Rate

A rate calculated before the accounting period begins, used to apply manufacturing overhead to products or job orders.

Direct Labor-hours

The total hours worked by employees who are directly involved in the manufacturing or production process of goods.