When Using a Perpetual Inventory System, Why Are Discounts Credited

question 181

Multiple Choice

When using a perpetual inventory system, why are discounts credited to Inventory?

• A)The discounts are debited to discount expense and thus the credit has to be made to merchandise inventory.
• B)The discounts reduce the cost of the inventory.
• C)The discounts are a reduction of business expenses.
• D)None of these answers choices are correct.

Understand how to calculate direct labor variance, including labor rate and time variance.

Interpret the significance of favorable and unfavorable variances in labor and material costs.

Distinguish between variable, fixed, and total factory overhead variances.

Apply concepts of factory overhead variances to real data, including fixed overhead volume and controllable variances.

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Definitions:

Social Reciprocity

The mutual exchange of social behavior, such as cooperation or communication, between individuals or groups.

Outcome Assessment

The process of evaluating the results of a treatment or intervention to determine its effectiveness over time.

Indiscriminable Contingencies

Situations in which individuals cannot predict when their behavior will be reinforced, often leading to more consistent behaviors.

Response Maintenance

The continuation of a learned behavior after the original conditions for learning are removed or not present.