When Using a Constant Dollar Plan

question 58

Multiple Choice

When using a constant dollar plan,

• A) gains from the speculative portion of the portfolio are transferred to the safe portion of the portfolio.
• B) the amount of money in the speculative portion of the portfolio should decline over time.
• C) the percentage of funds in the speculative portion of the portfolio should increase over time.
• D) the ratio of safe funds to speculative funds remains constant over time.

---

Definitions:

Cost of Goods Manufactured

The total production cost of goods completed during a specific accounting period, including labor, material, and overhead costs.

Work In Process

Inventory that includes goods that are in the production process but are not yet completed.

Factory Overhead

All indirect costs associated with manufacturing, including utilities, rent, and salaries for managers.

Direct Materials

Basic substances that can be directly linked and attributed to the creation of particular products or services.