Table 29-6. -Refer to Table 29-6. If the Fed's Reserve Requirement Is

question 325

Multiple Choice

Table 29-6.
-Refer to Table 29-6. If the Fed's reserve requirement is 5 percent, then what quantity of excess reserves does the Bank of Pleasantville now hold?

• A)$500
• B)$250
• C)$2,000
• D)$3,600

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Definitions:

Variable Costing

A costing method that includes only variable manufacturing costs—direct materials, direct labor, and variable manufacturing overhead—in product costs.

Ending Inventory

The total value of all goods available for sale at the end of an accounting period, not yet sold.

Variable Production Costs

Costs that vary directly with the level of production, such as materials, labor, and utilities needed for manufacturing.

Absorption Costing

An accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed manufacturing overhead) in the cost of a product.