Which of the Following Statements Is TRUE of Lump-Sum Payments

question 25

Multiple Choice

Which of the following statements is TRUE of lump-sum payments?

• A) It is a pay incentive system in which employees receive a share of the employer's profits on a monthly basis as their payment.
• B) It is a wage system that pays newly hired workers less than current employees performing the same or similar jobs.
• C) It is a method of providing a general wage increase as a onetime payment rather than adding the increase to the hourly or annual salary of the employee.
• D) It is a method of providing a general wage increase in which a lower wage adjustment is provided in the first year with higher increases in later years.

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Definitions:

Common Stock

An equity investment representing ownership in a company, entitling holders to vote at shareholder meetings and receive dividends.

Weighted Average Cost

A method of calculating the total cost of goods sold or assets that weighs each item's cost proportionately.

Face Value

The original value or principal amount of a security as stated by the issuer.

Weighted Average Cost

A method of calculating the average cost of inventory or cost of goods sold by weighting each item by its relevance or quantity.