The Capital Account of Benjie Maintenance, a Sole Trader, Was

question 38

Multiple Choice

The capital account of Benjie Maintenance, a sole trader, was credited with $15 000. Which of the following would not give rise to such a CR?

• A) The business earned a profit of $15 000.
• B) The owner purchased a family holiday valued at $15 000 using funds from the business.
• C) The owner introduced $15 000 new capital.
• D) The owner brought in his personal ride-on lawn mower (valued at $15 000) to be used by the business.

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Definitions:

Direct Materials Costs

The costs of raw materials that are directly involved in the manufacture of a product and can be directly traced to the product.

Fixed Overhead Costs

Expenses that do not vary with the level of production or sales, such as rent, salaries, and insurance.

Budgeted Manufacturing Cost

The projected costs involved in producing goods over a specific period, including labor, materials, and overhead expenses.

Flexible Budget Report

A financial report that compares actual results to a budget adjusted for the actual level of activity or volume of work performed.