Contracting with Vendors Outside the Organization to Obtain or Acquire

question 7

Multiple Choice

Contracting with vendors outside the organization to obtain or acquire goods and/or services is called

• A)target costing.
• B)insourcing.
• C)outsourcing.
• D)product harvesting.

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Definitions:

Prepaid Expense

Payments made beforehand for products or services that will be provided later on.

Prepaid Expense

Expenses paid in advance for goods or services to be received in the future, recorded as an asset on the balance sheet until consumed.

Accrued Liabilities

Expenses that have been incurred but not yet paid or recorded in the company's ledger, representing future outflows of cash.

Common Stock Account

An equity account on a company's balance sheet representing the total value of common shares that have been issued.