Darla Had $750 in Her Checking Account When Her Debit

question 17

Multiple Choice

Darla had $750 in her checking account when her debit card was stolen.Assuming the thief made $525 in purchases with the card,how much could she save by reporting the stolen ATM card immediately rather than waiting more than three months before reporting the theft?

• A)$50
• B)$525
• C)$475
• D)$500

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Definitions:

Product Cost

The total cost incurred to manufacture a product or to provide a service, including direct materials, labor, and overhead expenses.

Period Cost

Expenses that are not directly tied to the production process and are expensed in the period they are incurred, such as selling and administrative expenses.

Frosting

A sweet, often creamy glaze made of sugar with liquid (such as water or milk) and sometimes flavored, used to coat or decorate baked goods.

Prime Costs

The combined costs of direct materials and direct labor that are directly involved in the manufacturing of a product.