Which of the Following States That the Business Should Use

question 132

Multiple Choice

Which of the following states that the business should use the same accounting methods from period to period?

• A) materiality concept
• B) consistency principle
• C) conservatism
• D) disclosure principle

---

Definitions:

Conversion Cost

The sum of direct labor costs and manufacturing overhead costs, representing the total expense to convert raw materials into finished goods.

Sales Revenue

The total revenue earned from selling products or services before deducting any costs.

Manufacturing Overhead

Indirect factory-related costs that are incurred when a product is manufactured.

Differential Cost

The difference in total cost between two alternatives, highlighting how costs change under different operational decisions.