Inventories Include Each of the Following Except

question 91

Multiple Choice

Inventories include each of the following except

• A)unsold finished goods.
• B)goods in process.
• C)raw materials held by firms.
• D)office equipment.

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Definitions:

Markup

The surcharge applied to the original cost of items to compensate for overhead expenses and secure earnings.

Plantwide Predetermined Rate

A single overhead rate calculated using the total estimated overhead costs divided by an estimated allocation base for an entire factory or plant.

Machine-Hours

A measure of the time that a machine is in operation, used in costing and operational analysis.

Departmental Predetermined Rates

Overhead allocation rates set in advance for specific departments to allocate indirect costs more accurately.