The Concept That Assists Accountants in Determining When to Recognize

question 30

Multiple Choice

The concept that assists accountants in determining when to recognize revenue in the accounts is the:

• A)Cost principle.
• B)Time-period assumption.
• C)Recognition criteria for revenue.
• D)Matching objective.

---

Definitions:

Work in Process

Refers to the total cost of unfinished goods in the manufacturing process at any given time.

Estimated Overhead Costs

The anticipated costs for overhead activities in a business, including utilities, rent, and management salaries, not directly tied to product production.

Overapplied Overhead

A situation where the estimated overhead costs allocated to products or services exceed the actual overhead costs incurred.

Manufacturing Overhead Costs

Expenses related to the manufacturing process that are not directly tied to the production of goods, such as utilities and rent for the manufacturing space.