Which of the Following Is a Duty a Principal Has

question 12

Multiple Choice

Which of the following is a duty a principal has toward the agent?

• A)A principal must provide the agent with a record of all monetary transactions.
• B)A principal must obey routine instructions from the agent.
• C)A principal must keep the agent informed of all financial activities.
• D)A principal must reimburse the agent for expenses incurred during the agency.

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Definitions:

Allocated Cost

Expenses assigned to a specific department, project, or product, based on a formula or allocation method.

Budgeted Amounts

Estimates of revenues, expenses, and other financial activities for a future period, used for planning purposes.

Operating Departments

Divisions within an organization responsible for carrying out the main business activities directly related to generating revenues.

Two-Stage Cost

A method in cost accounting where costs are allocated to cost centers in two stages, first to departments then to products or services.