In Which of the Following Independent Situations Has Jean Made

question 70

Multiple Choice

In which of the following independent situations has Jean made a gift?

• A) She gives her 19-year old son $20,000 to use for his college expenses.
• B) She buys her nondependent grandfather a new $120,000 RV for his birthday.
• C) She sends $44,000 to Collins University to cover her nephew's tuition. The nephew does not qualify as Jean's dependent.
• D) She contributes $10,000 to her U.S. Senator's reelection campaign.

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Definitions:

First-In, First-Out Method

An inventory valuation method that assumes the first items purchased or produced are the first ones sold, affecting the cost of goods sold and ending inventory value.

Equivalent Units

A concept used in cost accounting to express the amount of materials, labor, and overhead in partially finished goods in terms of complete units of production.

Assembly Department

A section of a manufacturing plant where parts are assembled to create the end product.

Transferred

The act of moving goods, costs, or funds from one account, location, or product to another.