Which of the Following Considerations May Influence a Manager's Choice

question 139

Multiple Choice

Which of the following considerations may influence a manager's choice of the inventory cost flow assumption for a company that experiences rising prices?

• A)Compensation/bonus tied to reported income.
• B)Meeting earnings targets.
• C)Increase stock prices.
• D)All of the other answers are considerations for the choice of inventory cost flow assumptions.

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Definitions:

Output

The total quantity of goods or services produced by a firm, industry, or economy within a certain period.

Total Cost

The complete expenditure incurred in the production of goods or services, including fixed and variable costs.

Output

The total amount of something produced by a person, machine, or industry.

Average Variable Cost

The total variable costs (costs that change with production levels) divided by the quantity of output produced.