Balance Sheets Prepared in Compliance with U

question 94

Multiple Choice

Balance sheets prepared in compliance with U.S.GAAP reflect a mixture of

• A)historical cost and future cash values.
• B)current value and discounted future cash flows.
• C)discounted cash flows and future values.
• D)historical cost,fair value,net realizable value,and discounted present values.

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Definitions:

Variable Costing

A costing method that includes only variable manufacturing costs - direct materials, direct labor, and variable manufacturing overhead - in the cost of a product.

Unit Product Cost

The total cost assigned to a single unit of product, including direct materials, direct labor, and allocated overhead.

Absorption Costing

An approach in financial accounting that wraps all expenses incurred in manufacturing including direct materials, direct labor, and all overhead (variable and fixed), into the product's cost.

Net Operating Income

The total revenue of a business minus its operating expenses, excluding taxes and interest.