Last Year, Which Is Used as the Base Year, a Firm

question 77

Multiple Choice

Last year, which is used as the base year, a firm had cash of $52, accounts receivable of $223, inventory of $509, and net fixed assets of $1,107. This year, the firm has cash of $61, accounts receivable of $204, inventory of $527, and net fixed assets of $1,216. What is this year's common-base-year value of inventory?

• A) 0.67
• B) 0.91
• C) 0.88
• D) 1.04
• E) 1.18

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Definitions:

Multiple Production Department Rates

A method of applying overhead to products in which overhead costs are first directly traced or distributed to support and production departments.

Overhead Costs

Indirect expenses related to running a business that are not directly tied to producing a product or service, such as rent and utilities.

Support Department Costs

Expenses incurred by service departments that assist other units of a business, not directly involved in production.

Single Investment Application Rate

A metric used to assess the potential return on an individual investment to determine its profitability or effectiveness.