Depreciation Expense and Bad Debt Expense Are Examples of Which

question 47

Multiple Choice

Depreciation expense and bad debt expense are examples of which type of adjusting journal entry?

• A) deferrals
• B) accruals
• C) revaluations
• D) estimates

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Definitions:

Fixed Component

A portion of a cost that does not change with the level of production or sales over the short term.

Overapplied

A scenario in which the overhead costs allocated are higher than the overhead costs that were actually incurred.

Standard Cost System

An accounting method that uses predetermined costs for valuing inventory and recognizes variances between these costs and actual costs.

Cost of Goods Sold

The primary costs involved in the production of goods a company deals in, including the expenses for materials and labor.