Companies That Manufacture Goods and Hold onto Them for a While

question 122

Multiple Choice

Companies that manufacture goods and hold onto them for a while before selling them and companies that buy goods and hold them temporarily for resale have created ______.

• A)receivable assets
• B)accrual assets
• C)receivable storage
• D)inventories

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Definitions:

Telephone Costs

Expenses related to the usage of telecommunication services by a business, categorized as utility expenses and recorded in the income statement.

Margin Of Safety

The difference between actual or projected sales and the break-even point, measuring operational risk and efficiency.

Fixed Costs

Costs that do not change with the level of production or sales activities, such as rent, salaries, and insurance.

Contribution Margin Ratio

The percentage of each sales dollar that contributes to covering fixed costs and generating profit.