1) Money orders are considered cash.
2) On the variable costing income statement, deduction of the variable cost of goods
sold from sales yields gross profit.
3) The theory of constraints is a manufacturing strategy that focuses on reducing the
influence of bottlenecks on a process.
4) If a company uses the periodic inventory system to cost its inventory, the gross profit
method is a method that can be used to check on theft when the actual inventory is
taken by the company.
5) The doomsday ratio includes both cash and cash equivalents in the numerator.
6) Payroll taxes levied against employers become an employer liability at the time the
employee wages are incurred.
7) The task of preparing a budget should be the sole task of the most important
department in an organization.
8) There is a loss on redemption of bonds when bonds are redeemed above carrying
value.
9) When a bond is purchased for an investment, the purchase price, minus the brokerage
commission, plus any accrued interest is recorded.
10) The cost of a manufactured product generally consists of direct materials cost,
direct labor cost, and factory overhead cost.
11) A business using the perpetual inventory system, with its detailed subsidiary
records, does not need to take a physical inventory.