The Procedure of Converting a Categorical Variable to Numeric Values

question 57

Multiple Choice

The procedure of converting a categorical variable to numeric values is called:

• A) deteriorating.
• B) piloting.
• C) coding.
• D) constructing.

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Definitions:

Equivalent Unit

An Equivalent Unit is a measure used in cost accounting to express the amount of work done on partially finished goods in terms of fully finished goods.

First-In, First-Out Method

An inventory valuation method wherein the goods first added to the inventory are the first ones to be sold, ideal for products with shelf-life concerns.

Conversion Cost

The sum of direct labor and factory overhead costs, representing the expenses necessary to convert raw materials into finished goods.

Equivalent Units

A concept in costing used to convert partially completed goods into an equivalent number of fully completed units for inventory valuation.