Which of the Following Statements Regarding Accounting for By-Products Is

question 42

Multiple Choice

Which of the following statements regarding accounting for by-products is true?

• A) If all products are sold in the same period as they are produced, treating by-product revenue as other revenue will result in a higher overall gross margin.
• B) If all products are sold in the same period as they are produced, treating by-product net-realizable-value as a deduction of the cost of the main products will result in a higher overall gross margin.
• C) If all products are sold in the same period as they are produced, total reported revenues will be the same regardless of how by-product revenue is accounted for.
• D) If all products are sold in the same period as they are produced, the reported gross margin will be the same regardless of how by-product revenue is accounted for.

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Definitions:

Maturity Date

The date on which the principal amount of a loan, bond, or other financial instrument becomes due and payable.

Leap Years

Years that include an extra day (February 29) to keep the calendar year synchronized with the astronomical year.

Leap Years

Years with an extra day (February 29) added to keep the calendar year synchronized with the astronomical year or seasonal year.

Interest Computation

The process of calculating the interest due on a loan, based on the principal, interest rate, and time.