Which of the Following Statements Best Defines a Trigger Point

question 58

Multiple Choice

Which of the following statements best defines a trigger point in a sequential-tracking costing system?

• A) the inventory level at which a new purchase order is generated
• B) the point at which the sum of annual relevant stockout and ordering costs is minimal
• C) the production level at which the costing system becomes incapable of tracking the production costs
• D) a stage in the production cycle at which journal entries are made in the accounting system

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Definitions:

Distribution

In statistics, refers to the way in which values of a variable are spread or distributed across a range.

Null Hypothesis

It is a statistical hypothesis that asserts there is no significant effect or difference, serving as a default assumption until evidence suggests otherwise.

Normally Distributed

A symmetric probability distribution centered around the mean, illustrating that occurrences are more frequent near the mean and less frequent as they move away from it.

Critical Value

A threshold value used in hypothesis testing, which a test statistic must exceed to reject the null hypothesis.