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In Its Attempts to Source the Best Raw Materials, Enfi

question 3

Multiple Choice

In its attempts to source the best raw materials, Enfi Computers, a computer manufacturer, has associated with thirty suppliers spread across fourteen nations. Microchips, an integral part of any computer, are procured exclusively from a supplier in a different country. Enfi Computers has obtained an approval for this no-bid contract from its government and protected its supplies from any potential modifications caused by competing suppliers. Enfi Computers has resorted to _____ for its supply of microchips.

Definitions:

Accrual Basis

An accounting method where transactions are recorded when they are earned or incurred, regardless of when cash is exchanged.

Cash Basis

An accounting method where revenues and expenses are recorded when they are actually received or paid out, not when they are earned or incurred.

Time Basis

A method of compensation or work arrangement based on the amount of time spent on a job rather than the task's outcome.

Expenses Recorded

The process of documenting all costs incurred during a specific period in the financial records, which are used to assess the company's profitability.