On Which of the Four Major Financial Statements Would You

question 46

Multiple Choice

On which of the four major financial statements would you find the increase in inventory?

• A)Balance sheet
• B)Income statement
• C)Statement of cash flows
• D)Statement of retained earnings

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Definitions:

Activity-Based Costing

A costing methodology that assigns overhead and indirect costs to specific activities, providing more accurate product or service costing.

Direct Labor-Hours

A measure of the time workers spend on a specific task or production, often used for costing purposes.

Traditional Costing Method

An accounting approach that assigns manufacturing overhead costs to products based on a volume metric like direct labor hours or machine hours.

Activity-Based Costing

A costing methodology that assigns costs to products based on the amount of resources used for specific activities, such as manufacturing or selling.