Which of the Following Expenditure Classification Schemes May Be Used

question 5

Multiple Choice

Which of the following expenditure classification schemes may be used by governmental funds

• A) Activity
• B) Character
• C) Function
• D) All of the above

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Definitions:

Gross Profit Margin

A financial metric indicating the percentage of revenue that exceeds the cost of goods sold, reflecting the efficiency of a company in managing its production costs.

Normal Balances

The default side (debit or credit) of an account that is increased, reflecting the account's nature in double-entry bookkeeping.

Purchase Discounts

Reductions in price given by suppliers to buyers as an incentive for early payment of invoices or bulk purchases.

Freight In

The cost associated with transporting goods from suppliers to the recipient, typically recorded as part of inventory cost.