A Letter of Credit

question 33

Multiple Choice

A letter of credit:

• A) cannot last for more than five years.
• B) may be in either oral or written form.
• C) can only be issued by a bank.
• D) must be in writing and signed by the issuer.

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Definitions:

Clerical Costs

Expenses related to the administrative functions of an office, including salaries of office staff, stationery, and office supplies.

Standard Costs

Estimated or predetermined costs of manufacturing, selling, and administering a product or service.

Expected Future Costs

Projected expenses that a company anticipates incurring in the pursuit of its future activities.

Unavoidable Waste

Waste that cannot be prevented due to the nature of the production process or operational constraints.