You Are at a Parade Where There Are a Number

question 39

Multiple Choice

You are at a parade where there are a number of marching bands. You perceive the bands that are all in the same uniforms as being grouped together. The red uniforms are one band, the green uniforms another, and so forth. You have this perceptual experience because of the law of

• A) simplicity.
• B) similarity.
• C) pragnanz.
• D) familiarity.

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Definitions:

Equivalent Unit

An Equivalent Unit is a measure used in cost accounting to express the amount of work done on partially finished goods in terms of fully finished goods.

First-In, First-Out Method

An inventory valuation method wherein the goods first added to the inventory are the first ones to be sold, ideal for products with shelf-life concerns.

Conversion Cost

The sum of direct labor and factory overhead costs, representing the expenses necessary to convert raw materials into finished goods.

Equivalent Units

A concept in costing used to convert partially completed goods into an equivalent number of fully completed units for inventory valuation.