In Every Insurance Contract

question 7

Multiple Choice

In every insurance contract

• A)there is an endorsement.
• B)an insurable interest must be present.
• C)the insured pays the premiums.
• D)a and b.
• E)All of these.

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Definitions:

Product Costs

Expenses directly associated with the production of goods, including materials, labor, and overhead costs.

Period Costs

Expenses that are not directly tied to production and are expensed on the income statement in the period they are incurred, such as selling and administrative expenses.

Prepaids Insurance

Prepaid insurance refers to insurance premiums that are paid in advance and represent a future economic benefit for the period they cover.

Prime Costs

The combined costs of direct materials and direct labor that are directly involved in the production of goods.