Which of the Following Correctly Describes the Accounting for Factory

question 185

Multiple Choice

Which of the following correctly describes the accounting for factory depreciation?

• A) Factory depreciation is a product cost and is expensed as incurred.
• B) Factory depreciation is a period cost and is expensed as incurred.
• C) Factory depreciation is a product cost and is expensed when the manufactured product is sold.
• D) Factory depreciation is a period cost and is expensed when the manufactured product is sold.

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Definitions:

Responsibility Accounting System

An accounting framework that tracks financial performance by specific areas of responsibility, such as departments or managers.

Managers' Performance

Refers to the assessment and evaluation of the effectiveness and efficiency with which managers achieve business objectives and goals.

Cost Accounting System

A system of accounting for recording, classifying, allocating, and reporting costs associated with the production of goods and services.

Managerial Accounting System

A managerial accounting system focuses on providing financial and non-financial information to an organization's internal managers for decision-making purposes.