All of the Following Statements Are True Except

question 20

Multiple Choice

All of the following statements are true except:

• A) The criteria to determine whether a lease contract should be considered a capital lease are applied in a more rigid way under U.S.GAAP than IFRS.
• B) The criteria to determine whether a lease contract should be considered a capital lease are applied in a more rigid way under IFRS than U.S.GAAP.
• C) The lease criteria under IFRS are to be used as guidelines rather than rules.
• D) IFRS requires more accounting judgment than U.S.GAAP in the determination of whether a lease is classified as an operating lease or a capital lease.

---

Definitions:

Manufacturing Departments

Specific divisions within a manufacturing facility, each responsible for different aspects of the production process.

Predetermined Overhead Rates

A rate calculated before a period begins, used to allocate manufacturing overhead costs to products based on a selected activity base, such as machine-hours.

Markup

The amount added to the cost of a product to determine the selling price, typically expressed as a percentage of the cost.

Machine-Hours

An indicator of manufacturing productivity that calculates the total hours machinery is active in the production cycle.