Which of the Following Statements Is True of Main Products

question 126

Multiple Choice

Which of the following statements is true of main products and byproducts?

• A) A byproduct will never become a main product.
• B) A main product will never become a byproduct.
• C) Product classifications may change over time.
• D) Product classifications remains constant over time.

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Definitions:

Inventories

Quantities of goods that are held by a company for the purpose of resale or production.

Indirect Method

A way of preparing the cash flow statement where net income is adjusted for non-cash transactions and changes in working capital to arrive at operating cash flow.

Accounts Receivable

Funds that clients or customers owe to a company for products or services delivered but not yet compensated for.

Accounts Payable

Liabilities of a business that are due to suppliers and creditors within the short term, typically less than a year.