Tri-State Concrete Construction Company Relies on Factoring to Meet Its

question 220

True/False

Tri-State Concrete Construction Company relies on factoring to meet its short-term financing needs. This means that Tri-State borrows money from a finance company and pledges its accounts receivable as collateral.

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Definitions:

T-Accounts

A graphical representation used in accounting to depict the debit and credit sides of an account for easy visualization and calculation.

Cost Of Goods Sold

The direct costs attributed to the production of the goods sold by a company, including the cost of the materials and labor directly involved.

Manufacturing Overhead

All production costs other than direct materials and direct labor that are incurred in the manufacturing process and need to be allocated to produced goods.

Manufacturing Overhead Applied

The portion of manufacturing overhead costs assigned to individual units of production, based on a predetermined rate or method.