Inflation Is Best Defined as

question 343

Multiple Choice

Inflation is best defined as

• A) a sustained increase in the price of ALL goods and services in an economy.
• B) a relative price increase.
• C) a sustained increase in the average of all prices of goods and services in an economy.
• D) a sustained increase in the price of a single good or service.

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Definitions:

Conversion Costs

The combination of direct labor and factory overhead costs; in lean accounting, the account in which is accumulated the costs of direct labor and factory overhead.

Manufacturing Overhead Control

This involves managing and recording all indirect production costs associated with manufacturing operations, including utilities, maintenance, and equipment depreciation.

Backflush Accounting

A simplification of the accounting system by eliminating the accumulation and transfer of product costs by departments (intermediate departmental work in process accounts), but instead pulls the material and conversion costs directly to finished goods.

Work in Process Inventories

Items in various stages of production but not yet completed, representing a component of a manufacturer's inventory.