"Cream Skimming" Usually Results in

question 69

Multiple Choice

"Cream skimming" usually results in

• A)cross-subsidization of markets.
• B)subsidies to rural consumers of the service.
• C)regulations to provide universal service.
• D)monopoly.

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Definitions:

Weighted-Average Method

An inventory costing method that assigns the same average cost to all units available for sale, calculated as the total cost of goods divided by the total number of units available.

Equivalent Units

A concept used in cost accounting to represent the partial completion of goods in production, expressed in terms of fully completed units.

Molding Department

A specialized section in a manufacturing facility where raw materials are shaped into components through the molding process.

Weighted Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all units available for sale during the period.