If Inventories in a Business Using a Standard Cost System

question 85

Multiple Choice

If inventories in a business using a standard cost system are insignificant, the firm would be justified (in a practical sense) by disposing of variances each year:

• A) As an adjustment to the finished goods inventory only.
• B) As an adjustment to cost of goods sold only.
• C) As adjustments to both inventory accounts and the cost of goods sold for the period.
• D) As a special item (gain or loss) on the income statement for the period.
• E) As an adjustment to the work-in-process (WIP) inventory only.

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Definitions:

Innu

Indigenous peoples who traditionally inhabit parts of Canada, particularly in Quebec and Labrador, known for their rich cultural heritage and traditions.

Suicide Rates

The number of suicide deaths in a given population over a specified period of time, often expressed per 100,000 individuals annually.

Labrador

A geographic and cultural region within the larger province of Newfoundland and Labrador in Canada, known for its rugged terrain and significant indigenous population.

Suicide

The act of intentionally causing one's own death, often the result of mental health issues such as depression or anxiety.