Select the Incorrect Statement Regarding Costs and Expenses

question 139

Multiple Choice

Select the incorrect statement regarding costs and expenses.

• A) Some costs are initially recorded as expenses while others are initially recorded as assets.
• B) Expenses are incurred when assets are used to generate revenue.
• C) Manufacturing-related costs are initially recorded as expenses.
• D) Non-manufacturing costs should be expensed in the period in which they are incurred.

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Definitions:

Defined Contribution Pension Plan

A retirement plan where the employer, employee, or both make contributions, and the final benefits depend on the investment's performance.

Salaries

Payments made to employees for their labor or services over a period.

Social Security Tax

Definition: Taxes collected by governments to fund social security programs, typically levied on both employers and employees.

Medicare Tax

A federal tax taken from earnings to fund the Medicare program, which provides health insurance for individuals aged 65 and older.