A Current Asset Is

question 62

Multiple Choice

A current asset is

• A)the last asset purchased by a business.
• B)an asset that is not currently being used to produce a product or service.
• C)usually found as a separate classification in the statement of income.
• D)expected to be converted to cash or used in the business within a relatively short period of time.

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Definitions:

Factory Overhead

Costs associated with production that are not directly tied to individual products, including utilities, maintenance, and salaries of supervisory staff.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to related products and services based on the amount of activities used to produce them.

Markup Percentage

The percentage added to the cost of goods to determine the selling price, reflecting the profit margin on sales.

Variable Costs

Costs that change in proportion to the level of goods or services produced by a business.