The Misclassification of Freight-In as an Operating Expense Will Result

question 139

Multiple Choice

The misclassification of Freight-in as an operating expense will result in

• A) An overstatement of cost of goods sold
• B) An overstatement of gross margin
• C) An overstatement of net income
• D) None of these are correct

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Definitions:

Patent Protection

The granting of a legal right to an inventor to exclude others from making, using, or selling their invention for a limited period.

External Benefit

A benefit that an action or activity provides to individuals or groups who are not directly involved in it.

Private Cost

The cost incurred by an individual or company in producing goods or services, excluding any costs imposed on others which are not reflected in market prices.

Social Value

The overall impact of an organization, policy, or project on society as a whole, beyond just the direct economic benefits.