Which of the Following Is Not a Factor That Should

question 45

Multiple Choice

Which of the following is not a factor that should be considered in determining whether an activity is treated as an appropriate economic unit?

• A) The interdependencies between the activities.
• B) The extent of common control.
• C) The extent of common ownership.
• D) The geographical location.
• E) All of the above are relevant factors.

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Definitions:

Insurance In Transit

Coverage that protects goods from loss or damage while they are being transported from one place to another.

FOB Shipping Point

A term used in shipping indicating that the buyer assumes responsibility for the goods and shipping costs the moment the goods leave the seller's premises.

Merchandise Inventory

Goods and products that a firm holds with the intent to sell them as part of its business operations; considered a current asset on the balance sheet.

Perpetual Inventory System

A method for accounting inventory that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.