Which of the Following Sentences Is True of Normal Spoilage

question 94

Multiple Choice

Which of the following sentences is true of normal spoilage and abnormal spoilage?

• A) Normal spoilage costs are inventoriable and are added to the cost of good units produced, while abnormal spoilage costs are deducted from the cost of good units produced.
• B) Abnormal spoilage costs are inventoriable and are deducted from the cost of good units produced, while normal spoilage costs are expensed in the accounting period in which they occur.
• C) Abnormal spoilage costs are inventoriable and are added to the cost of good units produced, while normal spoilage costs are expensed in the accounting period in which they occur.
• D) Normal spoilage costs are inventoriable and are deducted from the cost of good units produced, while abnormal spoilage costs are expensed in the accounting period in which they occur.

Know the trial procedures used to test the clarity and plausibility of research methodologies.

Understand the concept of perfect competition and its characteristics.

Analyze the conditions under which firms in a perfectly competitive market operate including profit maximization, losses, and the long-run equilibrium.

Differentiate between short-run and long-run operations and outcomes for firms in a perfectly competitive market.

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Definitions:

Ordinary Simple Interest

Interest calculated on the principal amount of a loan or investment, based on a 360-day year.

Ordinary Simple Interest

A method for calculating the interest charge on a loan or investment based on the original principal, rate, and length of time, without compounding.

360-Day Year

A financial calculation assumption where the year is considered to have 360 days for simplifying interest related calculations.

Ordinary Simple Interest

Interest calculated on the principal amount of a loan or investment based on a simple interest rate, without the compounding factor.