Unplanned Inventory Decreases

question 48

Multiple Choice

Unplanned inventory decreases:

• A)​tend to result in an decrease in income.
• B)​tend to result in an increase in real output.
• C)​tend to further reduce production.
• D)​signal that demand was weaker than expected.

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Definitions:

Dishonored

Refers to a financial instrument, such as a check or promissory note, that is not accepted or paid at maturity due to insufficient funds or other reasons.

Supplementary Record

A document or collection of notes that provides additional information beyond the core financial statements, offering deeper insight into a company's financial position.

Balance Sheet Methods

Techniques used in preparing and presenting the balance sheet, a financial statement showing a company's assets, liabilities, and equity at a specific point in time.

Receivables Financing

A form of financing where a company uses its accounts receivable as collateral to secure funding from a financial institution.