Operating Expenses Consist of

question 105

Multiple Choice

Operating Expenses consist of

• A) Interest Expense and General Expenses.
• B) Selling Expenses and Cost of Goods Sold.
• C) Interest Expense and Selling Expenses.
• D) General Expenses and Selling Expenses.
• E) Interest Expense and Cost of Goods Sold.

---

Definitions:

Machine-Hours

A measure of production time that indicates the total hours machines are operating in the production process.

Machining Department

A specific division within a manufacturing facility where machining processes such as cutting, drilling, or shaping materials are carried out.

Customizing Department

A unit within an organization that adapts products to fit the unique needs or likes of its customers.

Predetermined Overhead Rate

A rate calculated before the accounting period begins, used to allocate manufacturing overhead costs to individual units of product based on a certain activity, like labor hours.