The Method of Distributing Service Department Costs to Production Departments

question 39

Multiple Choice

The method of distributing service department costs to production departments that takes into consideration that service departments not only may provide service to but also may receive service from other service departments is the:

• A)direct distribution method.
• B)sequential distribution method.
• C)service department distribution method.
• D)algebraic distribution method.

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Definitions:

Expiration Date

Refers to the date on which a derivative contract (such as options or futures) ceases to exist and its right to execute is no longer valid.

Exercise Price

The exercise price is the price at which an option holder can buy (call option) or sell (put option) an underlying asset or security.

Call Option

An agreement in finance that allows the owner the option, but not the requirement, to purchase a stock, bond, commodity, or different asset at a determined price during a defined timeframe.

Writer

In the context of options, the seller of an option contract who is obligated to meet the terms of the contract if the option is exercised.