Which of the Following Statements Is True

question 80

Multiple Choice

Which of the following statements is true?

• A) Nonactivists argue that monetary and fiscal policies should be deliberately used to smooth out the business cycle.
• B) Fine-tuning consists of the usually frequent use of monetary policy to counteract even small undesirable movements in economy activity.
• C) Keynesians would be more likely to advocate contractionary monetary policy to correct an inflationary gap than expansionary monetary policy to correct a recessionary gap.
• D) b and c
• E) a,b and c

Understand the components included in product costing within a manufacturing environment, such as direct materials, variable conversion costs, and fixed overhead allocation.

Calculate equivalent units of output and understand the concept in the context of work-in-process and completed production.

Recognize the importance of cost allocation methods and their impact on product pricing.

Identify the role of direct labor hours and machine hours in product costing and overhead allocation.

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Definitions:

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, converting them into full units of output for reporting purposes.

Work in Process Inventory

Items that are partway through their manufacturing process but have not yet reached their final form.

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, measured in terms of the amount of finished goods those partial items represent.

Weighted Average Method

A cost accounting method that calculates the cost per unit of inventory by considering the weight of each period’s inventory cost.