Value Judgments

question 17

Multiple Choice

Value judgments:

• A)always produce predictable results.
• B)are subjective opinions that cannot be proven correct on the basis of objective facts or evidence.
• C)should be the basis for all serious policy discussions.
• D)can always be tested and verified using accepted standards of logic and evidence.

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Definitions:

Net Operating Income

The profit generated from a company's core business operations, excluding expenses and revenues from non-operating activities.

LIFO

Last In, First Out, an inventory valuation method where the most recently produced items are recorded as sold first.

Absorption Costing

A method of accounting in which all the costs associated with the production of a product are absorbed by that product. This includes direct costs like materials and labor, as well as fixed and variable overhead.

Variable Costing

An accounting method that only includes variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product costs.