The Purchase Order

question 37

Multiple Choice

The purchase order

• A)is the source document to make an entry into the accounting records
• B)indicates item description, quantity, and price
• C)is prepared by the inventory control department
• D)is approved by the end-user department

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Definitions:

Depletion Rate

A method of accounting for the reduction of a product's reserves, such as natural resources, calculating the expense of extracting or using those resources over a period.

Depletion Expense

The allocation of the cost of natural resources, such as minerals or timber, over their productive life to reflect their consumption.

Tons

A measurement unit of weight equal to 2,000 pounds in the United States (short ton) or 2,240 pounds in the UK (long ton).

Straight-Line Method

A depreciation technique that allocates an equal portion of an asset’s cost to each year of its useful life.