In a Perpetual Inventory System, the Flow of Inventory Cost

question 45

Multiple Choice

In a perpetual inventory system, the flow of inventory cost is:

• A) First through the income statement, then through the statement of financial position.
• B) First through the statement of financial position, then through the income statement.
• C) Only through the statement of financial position and not the income statement.
• D) Only through the income statement and not the statement of financial position.

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Definitions:

Regressive

Relating to a tax system that disproportionately impacts those with lower incomes, or to policies that may reverse political or social progress.

Regressive Tax

A tax imposed in such a way that the tax rate decreases as the taxable amount increases, disproportionately affecting lower-income individuals.

Payroll Tax

Levies charged on employers or workers, typically based on a proportion of the wages that staff receive from their employers.

Labor Market

The labor market is an economic market in which workers seek employment and employers seek to hire workers, often influenced by factors like wages, demand, and qualifications.