Which Account Is Usually a Separate Line Item on the Multiple-Step

question 122

Multiple Choice

Which account is usually a separate line item on the multiple-step income statement?

• A)Cash
• B)Dividends
• C)Paid-in capital
• D)Retained earnings
• E)Income taxes

Understand the concept and purpose of a budget in an organization.

Identify the difference between a strategic plan and a financial/budget plan.

Recognize the role of budgets in performance evaluation and cost control.

Understand the concept and application of resource drivers in cost estimation.

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Definitions:

Absorption Costing

A costing method that includes all manufacturing costs, both variable and fixed, in the cost of a product.

Gross Margin

The difference between sales revenue and cost of goods sold, representing the fundamental profit derived from trading activities, before deduction of operating expenses.

Operations

Activities involved in the day-to-day running of a business for the purpose of producing value for the stakeholders.

Variable Costing

An accounting method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in the cost of goods sold.