Sales commissions and salesperson salaries may be classified as (Points : 4) sel

Question

Sales commissions and salesperson salaries may be classified as (Points : 4)
selling expenses.
advertising expenses.
depreciation expenses.
both a & b.

Question 2.2. (TCO 4) Which of the following statements regarding the risk associated with R&D activities is correct? (Points : 4)
The amount of time between the R&D activity and the cash flows from the project does not affect risk.
Greater risk is associated with improving existing products than creating new products.
Risk increases as the time between the R&D activity and the cash flows from the project increases.
Assessing risk is a trivial part of research and development.

Question 3.3. (TCO 4) The most significant expense incurred in the nonmanufacturing functions of a business is usually (Points : 4)
advertising.
salaries.
rent.
insurance.

Question 4.4. (TCO 4) Which of the following is not a reason why capital expenditures are incurred? (Points : 4)
Changes in production methods
Increased production
Preventive maintenance
Decreased sales

Question 5.5. (TCO 4) Which of the following is not a capital expenditure? (Points : 4)
Improving quality
Purchasing inventory
Marketing a new product
Replacing equipment

Explanation / Answer

Solution:

1. selling expenses

2.2 Risk increases as the time between the R&D activity and the cash flows from the project increases.

3.3 Advertising

4.4 Decreased Sales

5.5 Purchasing Inventory

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