Financing That Arises from the Normal Operations of the Firm

question 5

Multiple Choice

Financing that arises from the normal operations of the firm is said to be

• A) expected.
• B) accrued.
• C) spontaneous.
• D) payable.

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Definitions:

Period Costs

Costs that are expensed in the period in which they are incurred, rather than being capitalized or included in the cost of goods sold.

Raw Materials Inventory

The goods and materials that a company holds that are intended for use in the production process.

Raw Materials Purchased

The total cost of raw materials bought by a company for use in production during a specific time period.

Job Order Cost Sheet

A record maintained for each job in a job order costing system, detailing the materials, labor, and overhead costs incurred.