Heavy Manufacturing Company Is in the Business of Making Steel

question 40

Multiple Choice

Heavy Manufacturing Company is in the business of making steel plates,forming heavy metal slabs,and drilling and scoring metals.The company recently upgraded many of its forming machines.Fortunately,it was able to sell its old equipment at a reasonable price.The effect was that sales for the quarter are substantially improved over the same period in the prior year.The general transaction-related audit objective affected by this activity is

• A)timing.
• B)accuracy.
• C)occurrence.
• D)classification.

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Definitions:

Marginal Cost

The additional expense incurred from producing one more unit of a good or service.

Standardized

Made uniform in form or character, often to enable comparability across different contexts or systems.

Perfectly Competitive

A market structure characterized by many buyers and sellers, free entry and exit, and a homogenous product, leading to no single consumer or producer having market power.

Short Run

A period in economics where at least one factor of production is fixed, and firms can't adjust all inputs.