If Machine Maintenance Is Scheduled at a Time When Production

question 53

Multiple Choice

If machine maintenance is scheduled at a time when production is at a low level, then ________.

• A) low production is the cost driver of high repair costs
• B) an understanding of operations is needed to determine an appropriate cost driver
• C) low production should be avoided since it is the cause of machine maintenance
• D) machine maintenance cannot be accurately predicted

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Definitions:

Sales Discount

A reduction given by a seller for prompt payment of a credit sale.

Cash Receipts Journal

A specialized accounting journal used to keep track of all cash inflows or receipts from various sources.

Entry

A record in an account that documents a financial transaction in bookkeeping.

Special Journals

Customized accounting journals used for recording specific types of transactions that occur frequently.