Which of the Following Statements Is Most Correct

question 69

Multiple Choice

Which of the following statements is most correct?

• A)The financial crisis and recession of 2007-2009 had little effect on the ability of borrower firms to obtain short-term financing and for firms with surplus funds to invest in short-term instruments.
• B)The financial crisis and recession of 2007-2009 had strong effects on the ability of borrower firms to obtain short-term financing and for firms with surplus funds to invest in short-term instruments.
• C)The financial crisis and recession of 2007-2009 had strong effects on the ability of borrower firms to obtain short-term financing but made it easy for firms with surplus funds to invest in short-term instruments.
• D)The financial crisis and recession of 2007-2009 had little effect on the ability of borrower firms to obtain short-term financing but made it easy for firms with surplus funds to invest in short-term instruments.
• E)none of the above

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Definitions:

First-In, First-Out

An inventory valuation method assuming that goods are sold or used in the same order as they were purchased or produced.

Direct Labor

The work of employees that is directly associated with the production of goods or services.

Factory Overhead

Encompasses all indirect costs involved in the manufacturing process, such as utilities, maintenance, and salaries of non-direct labor.

FIFO Method

"First In, First Out," an inventory valuation method that assumes that the first items placed in inventory are the first sold, affecting the cost of goods sold and inventory valuation.