In Some Forms of Outsourcing, a Company Hires an External

question 15

True/False

In some forms of outsourcing, a company hires an external vendor to create the software for its system, but operates the software on its own computers.

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Definitions:

Weighted-Average Method

This approach to inventory valuation calculates both the cost of goods sold and the closing inventory value using the mean cost of all saleable units during the period.

Process Costing

Process costing is an accounting methodology used for homogeneous products, allocating costs to units of output by averaging the costs over all units produced.

Cost Reconciliation Report

A financial statement that reconciles the total costs incurred with the costs accounted for, to ensure accuracy in financial reporting.

Weighted-Average Method

A cost accounting method that calculates the cost per equivalent unit of goods during a period by taking into account both the cost and quantity of the units produced.