A Leather Shoe Manufacturer Makes "Duck" Boots That Consist of Leather

question 147

Multiple Choice

A leather shoe manufacturer makes "duck" boots that consist of leather and rubber. Some of the books are defective and are sold in the factory store at deep discounts. Leather strips from the cutting process and rubber shavings are byproducts of the process. The leather strips have no use and are discarded while the rubber scraps are collected and periodically picked up by a recycling company at no cost to the shoe manufacturer. Which of the following classifications of these items would be accurate?

• A) the defective boots are spoilage and the leather and the rubber are scrap
• B) the defective boots, leather and rubber are scrap but the shoes are more valuable scrap as they can be sold
• C) the defective boots are spoilage , the leather strips are scrap, and the rubber is rework
• D) all three items are spoilage

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Definitions:

Index Funds

Mutual funds or exchange-traded funds designed to replicate the performance of a specific index, such as the S&P 500.

Day Trader

An individual who buys and sells financial instruments, such as stocks, within the same trading day, aiming to capitalize on short-term market fluctuations.

Investing

The act of dedicating resources (such as capital, time, or effort) to an endeavor with the expectation of achieving a profit or material result.

Standard Deviation

A statistical measure that quantifies the variability or spread of a set of numbers around their mean; it helps in assessing data consistency.