Match Each Statement with the Correct Term Below

question 4

Multiple Choice

Match each statement with the correct term below.
-Hobby expense

• A)Automobile used 75% for business.
• B)Investment interest expense on loan to acquire municipal bonds.
• C)Cost of investigating a new trade or business that the taxpayer enters.
• D)Can be separated into two classifications.
• E)Expenses related to royalty income
• F)Expenditure to influence legislation.
• G)Cost of a new roof for office building.
• H)Relates to an income producing activity mainly carried on for recreation or personal enjoyment.
• I)Deductibility depends on income and amount of personal and rental use.
• J)Deductibility depends on whether the area is used exclusively for trade or business activities.

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Definitions:

Direct Labor-Hours

Represents the total hours worked directly on the production of goods.

Manufacturing Overhead

Costs related to the manufacturing process that cannot be directly linked to specific products, including utility costs, depreciation, and maintenance of equipment.

Predetermined Overhead Rate

An allocated rate used to apply manufacturing overhead to products or job orders, estimated at the start of an accounting period.

Job-Order Costing

A costing system used to accumulate costs for individual jobs or orders, typically used when products or services are distinct and customized.