Which of the following statements regarding accounting for by-products is true?
A. If all products are sold in the same period as they are produced, the reported gross margin will be the same regardless of how by-product revenue is accounted for.
B. If all products are sold in the same period as they are produced, treating by-product net-realizable-value as a deduction of the cost of the main products will result in a higher overall gross margin.
C. If all products are sold in the same period as they are produced, treating by-product revenue as other revenue will result in a higher overall gross margin.
D. If all products are sold in the same period as they are produced, total reported revenues will be the same regardless of how by-product revenue is accounted for.
Answer: A
You might also like to view...
What are the four types of alternative situational strategies produced by the dual concerns model?
What will be an ideal response?
The ________ method allows managers to increase operating income through production by producing more products than needed.
A) absorption costing B) variable costing C) direct costing D) marginal costing
Where is a good place for the bottom line in e-mail?
a. at the bottom (or end) of the document b. near the bottom of the document c. in the subject line d. none of the above
In the 1920's many employers who followed the human resources school of thought believed that nonunion representation plans were:
A. unnecessary if management was exercising good human resources B. a threat to management's decision-making authority C. helpful in promoting mutual respect, cooperation and loyalty D. vital to protecting worker rights and interests