Current Liabilities Include

question 26

Multiple Choice

Current liabilities include

• A) amounts due from suppliers for credits on accounts given on returns which had previously been paid.
• B) taxes withheld from employees' payroll checks which must be remitted to the IRS.
• C) amounts paid for warranty repairs during the current year.
• D) cash dividends to be declared by the board of directors during the next six months.

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Definitions:

Absorption Costing

A costing method that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed overhead - as part of the cost of a produced unit.

Unit Product Cost

The total cost, including materials, labor, and overhead, divided by the number of units produced.

Year 2

Refers to the second year of a time-related context or sequence, not a standalone key term without additional context.

Contribution Margin

The amount of revenue remaining after subtracting variable costs, indicating how much contributes towards covering fixed costs and generating profit.