Sales Taxes Payable

question 14

Multiple Choice

Sales taxes payable:

• A) Is an estimated liability.
• B) Is a contingent liability.
• C) Is a current liability for retailers.
• D) Is a business expense.
• E) Is a long-term liability.

Understand the concept of book value and how it differs from fair market value.

Learn the accounting treatments for natural resources including depletion.

Understand the concept of production possibility curve (PPC) and its implications.

Calculate and interpret the opportunity cost in various economic scenarios.

---

Definitions:

Manufacturing Overhead Account

An account that tracks indirect production costs, such as utilities and rent for manufacturing facilities.

Work in Process

Inventory items that are partially completed but not yet ready for sale; represents goods in various stages of production.

Predetermined Overhead Rate

A rate calculated at the beginning of a period by dividing estimated overhead costs by an estimated activity base, such as labor hours, used to allocate overhead costs to products.

Direct Labor-Hours

A measure of the total hours worked by employees directly involved in the manufacturing process, used as a base for allocating overhead costs.