An economic value added method is specific type of method to calculate _____________?
Correct answer: C. residual income
- A. net income
- B. nominal income
- C. residual income
- D. residual investment
Explanation
Economic value added is a refined form of residual income that subtracts a capital charge from after-tax operating profit. It shows whether the company created value beyond the cost of its funds.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
Practise Cost Accounting
941 free Cost Accounting MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Cost Accounting questions
The rupee amount for required return of investment is subtracted from income to calculate _____________?
The total available assets are subtracted from idle assets to calculate
The costing system, which is a combination of process costing and job costing system, is classified as __________?
The after-tax average cost of the funds used by company in long run is equal to __________?
In an accounting measurement, income and investment is divided to calculate _________?
The sum of all the resources used to generate income is classified as _____________?