An Increase in Future Value Can Be Caused by an Increase

question 21

Multiple Choice

An increase in future value can be caused by an increase in the:

• A)annual interest rate.
• B)number of compounding periods.
• C)original amount invested.
• D)both A and B.
• E)all of the above.

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Definitions:

Predetermined Overhead Rate

An estimated rate used to assign manufacturing overhead costs to individual products or job orders, calculated before the actual costs are known.

Capacity

The maximum level of output that a company can sustain to produce goods or services.

Estimated Activity

An approximation of the level of operational or production activity expected in a certain period, typically used for budgeting and costing.

Unused Capacity

The portion of a company's production or operational potential that is not currently being utilized.