In Addition to the Tasks of Recording and Classifying Accounting

question 290

True/False

In addition to the tasks of recording and classifying accounting information, the best accounting software programs currently available for small businesses have the ability to make financial decisions, thus eliminating the need for owners of small businesses to consult with accountants or understand accounting terminology.

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Definitions:

Direct Materials

Raw materials that are directly traceable to the production of specific goods or services and are an integral part of the finished product.

Variable Factory Overhead

Variable factory overhead consists of production costs that vary with the level of output, such as utilities and indirect materials.

Fixed Costs

Costs that tend to remain the same in amount, regardless of variations in the level of activity.

Differential Revenue

The additional revenue generated from choosing one alternative over another in decision-making processes.