What Is the Amount of the Temporary Difference Between Straight

question 51

Multiple Choice

What is the amount of the temporary difference between straight line depreciation and capital cost allowance on December 31,2010?

• A)Nil
• B)$2,000
• C)$3,000
• D)$1,500

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Definitions:

Beginning Work In Process

The inventory of partially completed goods at the start of an accounting period.

Inventory Formula

The equation used to calculate the value of a company's inventory, commonly stated as Beginning Inventory + Purchases - Cost of Goods Sold = Ending Inventory.

Physical Flow

The actual movement of goods or materials through a manufacturing process, from receipt of raw materials to delivery of finished products.

Weighted Average Method

An inventory valuation method that applies a weighted average cost to the goods available for sale, to calculate cost of goods sold and ending inventory.