Capacity Is

question 17

Multiple Choice

Capacity is:

• A) determined by lean manufacturing.
• B) the maximum amount of square footage available for inventory storage in a facility.
• C) determined by raw materials flows.
• D) the maximum amount of work that an organization is capable of completing in a given period of time.

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Definitions:

Expense Account(s)

Accounts used to record expenses in the general ledger, which represent the costs of operating a business that are not directly tied to the production of goods or services.

Income Summary

An account used in the closing process, summarizing all revenues and expenses for a period, to transfer the net result to capital accounts.

Capital Account

A capital account is an account on a company's balance sheet that represents the equity investment of owners and shareholders.

Closing Entries

Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to a permanent equity account.