Capacity Cost Is

question 20

Multiple Choice

Capacity cost is

• A)only an inventoriable cost.
• B)only a period cost.
• C)never amortized.
• D)a variable manufacturing overhead cost.
• E)a fixed manufacturing overhead cost.

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Definitions:

Debit Side

The debit side refers to the left side of an accounting ledger where debits are recorded, often signifying an increase in assets or expense accounts, or a decrease in liability, equity, or revenue accounts.

Credit Side

The right side of an account ledger, where increases in liabilities, equity, and revenue or decreases in assets are recorded.

Asset Account

An account on a company's balance sheet that represents a resource with economic value that is expected to provide future benefit.

Supplies

Items or materials used in the daily operations of a business.