Which of the Following Is Not Correct Concerning Futures Contracts

question 57

Multiple Choice

Which of the following is not correct concerning futures contracts?

• A)Entails an obligation rather than an option.
• B)Contract price is set at the beginning of the contract.
• C)Contracts are exchange-traded.
• D)Gains or losses are recorded at contract expiration.

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Definitions:

Cost Difference

The variance between the actual cost and the standard or expected cost of an item or activity.

ABC System

Activity-Based Costing System, a method of assigning overhead and indirect costs to specific products and services based on their consumption of resources.

Cost Pools

Groupings of individual costs based on their similarity or a shared function, used in activity-based costing to allocate costs more accurately.

ABC System

Stands for Activity-Based Costing system, a method of allocating overhead and indirect costs to specific products or services based on their consumption of resources.