If Management Wanted to Determine If Customers Were Returning Goods

question 88

True/False

If management wanted to determine if customers were returning goods at a higher rate than usual,it could use the Sales Returns and Allowances account to analyze the information.

---

Definitions:

Machine-Hours

A measurement of the amount of time a machine is operated, used in allocating costs or determining production levels.

Molding

The process of shaping a pliable raw material by using a rigid frame or model called a mold.

Assembly

The process of putting together various components or pieces to build a finished product.

Predetermined Overhead Rate

A rate calculated before the accounting period begins, used to estimate the cost of manufacturing overhead for a specific activity base.