Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory

Financial Accounting

4. Merchandising Operations

Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory

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Multiple Choice

Flash Company produces lamps. Which of the following is NOT considered a direct cost in the production of lamps?

Wages paid to assembly line workers

Raw materials used to make lamp bases

Cost of lamp shades used in production

Depreciation on factory equipment

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Verified step by step guidance

Understand the concept of direct costs: Direct costs are expenses that can be directly traced to the production of a specific product or service. These costs are easily identifiable and directly associated with the manufacturing process.

Review the examples of direct costs provided in the problem: Wages paid to assembly line workers, raw materials used to make lamp bases, and the cost of lamp shades used in production are all examples of direct costs because they are directly tied to the production of lamps.

Analyze the nature of depreciation on factory equipment: Depreciation is an indirect cost because it represents the allocation of the cost of an asset (factory equipment) over its useful life. It is not directly tied to the production of a specific product but rather to the overall operation of the factory.

Differentiate between direct and indirect costs: Direct costs are specific to the product being manufactured, while indirect costs, such as depreciation, are general expenses that support the production process but cannot be directly traced to a single product.

Conclude that depreciation on factory equipment is NOT a direct cost in the production of lamps, as it is an indirect cost related to the overall factory operations rather than the specific production of lamps.