As a General Rule,failure to Equalize the Marginal Benefits and Costs

question 55

Multiple Choice

As a general rule,failure to equalize the marginal benefits and costs of any publicly approved activity,e.g. ,crime control,results in

• A)an inefficient level of the activity;either too little or too much.
• B)too much of the activity.
• C)too little of the activity.
• D)the wrong activities.

Understand the basic accounting equation and how transactions affect it.

Identify the correct way to record purchases and expenses, whether paid by cash or on account.

Comprehend the nature of asset, liability, capital, revenue, and expense accounts including their normal balances.

Record owner's withdrawals and investments in the business.

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Definitions:

Cost of Goods Manufactured

Total manufacturing costs incurred plus the beginning work-in-process inventory, minus the ending work-in-process inventory.

Adjusted Cost

The modification of the historical cost of an asset to reflect changes due to depreciation or amortization.

Goods Sold

The total quantity of products a company has sold during a particular period; it is closely related to "cost of goods sold" but focuses on the volume rather than the cost.

Work in Process

Inventory items that are partially completed, residing between raw material and finished goods stages in the production process.