Both the Par Value of the Stock and the Additional

question 105

Multiple Choice

Both the par value of the stock and the additional paid-in capital are part of:

• A)retained earnings.
• B)legal capital.
• C)paid-in capital.
• D)stated value.

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Definitions:

Unit Product Cost

The total cost (direct materials, direct labor, and overhead) to produce one unit of a product.

Absorption Costing

An accounting method that includes all manufacturing costs (direct material, direct labor, and both variable and fixed manufacturing overhead) in the cost of a product.

Net Operating Income

A company's total earnings from its operations, excluding taxes and interest.

Absorption Costing

A cost accounting procedure that comprises adding up all expenses involved in manufacturing—direct materials, direct labor, and manufacturing overhead, both fixed and variable—to the cost of the product.