Solid Surface,a Countertop Store,will Give Customers a 10 Percent Discount

question 59

Multiple Choice

Solid Surface,a countertop store,will give customers a 10 percent discount if they pay their bills in full in 20 days; however,after 20 days they do not receive a discount.This is an example of _______________.

• A)Cash discounts
• B)Trade discounts
• C)Quantity discounts
• D)Seasonal discounts
• E)Promotional allowances

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Definitions:

Units Transferred

The amount of finished or semi-finished products moved from one stage of production to another, or to the final inventory.

FIFO Method

An inventory valuation method that assumes the first items purchased (First-In) are the first ones sold (First-Out), affecting the cost of goods sold and inventory valuation.

Cost Reconciliation

The process of verifying the cost of goods sold by comparing the beginning and ending inventories, plus purchases, with the total goods available for sale.

Work in Process Inventory

This represents the cost of unfinished goods in the manufacturing process at a certain point in time.