Question 1

An example of a fixed cost is

Accepted Answer

A) total indirect material cost. 
B) total hourly wages. 
C) cost of electricity. 
D) straight-line depreciation. 
A) total indirect material cost. 
B) total hourly wages. 
C) cost of electricity. 
D) straight-line depreciation.

Question 2

Costs that are incurred when customers complain are:

Accepted Answer

A) prevention costs 
B) detection costs 
C) appraisal costs 
D) failure costs 
A) prevention costs 
B) detection costs 
C) appraisal costs 
D) failure costs

Question 3

Fixed cost per unit varies directly with production.

Accepted Answer

A) True 
 B)False

Question 4

Anything for which management wants to accumulate or collect costs is known as a _________________________.

Accepted Answer

The answer of Anything for which management wants to accumulate...

Question 5

McCoy Company manufactures tables.The beginning balance of Raw Material Inventory was $5,500;raw material purchases of $31,500 were made during the month.At month end,$8,200 of raw material was on hand.Raw material used during the month was

Accepted Answer

A) $28,800 
B) $31,500 
C) $37,000. 
D) $39,200 
A) $28,800 
B) $31,500 
C) $37,000. 
D) $39,200

Question 6

If the cost of an additive is $5,000 + $0.50 for every unit of solvent produced,the cost is classified as a mixed cost.

Accepted Answer

A) True 
 B)False

Question 7

A mixed cost will be an effective cost driver.

Accepted Answer

A) True 
 B)False

Question 8

Conversion of inputs to outputs is recorded in the

Accepted Answer

A) Work in Process Inventory account. 
B) Finished Goods Inventory account. 
C) Raw Material Inventory account. 
D) both a and b. 
A) Work in Process Inventory account. 
B) Finished Goods Inventory account. 
C) Raw Material Inventory account. 
D) both a and b.

Question 9

Costs that are incurred to preclude defects and improper processing are:

Accepted Answer

A) prevention costs 
B) detection costs 
C) appraisal costs 
D) failure costs 
A) prevention costs 
B) detection costs 
C) appraisal costs 
D) failure costs

Question 10

What is the difference between a product cost and a period cost? Give three examples of each.What is the difference between a direct cost and indirect cost? Give two examples of each.

Accepted Answer

A product cost is one that is associated

Question 11

Bridges Corporation
The following information has been taken from the cost records of Bridges Corporation for the past year:
Raw material used in production                                                $336
Total manufacturing costs charged to production during            711
the year (includes direct material, direct labor, and
 overhead equal to 50% of direct labor cost)
Cost of goods available for sale                                                  851
Selling and Administrative expenses                                           35
Inventories
Begining  Ending    Raw material  $80     $90   Work in process85      25 Finished goods80    105
Refer to Bridges Corporation.The cost of raw material purchased during the year was

Accepted Answer

A) $326. 
B) $346 
C) $375 
D) $426 
A) $326. 
B) $346 
C) $375 
D) $426

Question 12

Which of the following is not a product cost component?

Accepted Answer

A) rent on a factory building 
B) indirect production labor wages 
C) janitorial supplies used in a factory 
D) commission on the sale of a product 
A) rent on a factory building 
B) indirect production labor wages 
C) janitorial supplies used in a factory 
D) commission on the sale of a product

Question 13

The indirect costs of converting raw material into finished goods are called

Accepted Answer

A) period costs. 
B) prime costs. 
C) overhead costs. 
D) conversion costs. 
A) period costs. 
B) prime costs. 
C) overhead costs. 
D) conversion costs.

Question 14

Which of the following defines variable cost behavior?
Total cost reaction          Cost per unit reaction
to increase in activity      to increase in activity

Accepted Answer

A) remains constant remains constant 
B) remains constant increases 
C) increases increases 
D) increases remains constant 
A) remains constant remains constant 
B) remains constant increases 
C) increases increases 
D) increases remains constant

Question 15

Wyman Enterprises
Inventories:  March 1   March 31 Raw material $18,000 $15,000  Work in process 9,000 6,000    Finished goods  27,000 36,000   Additional information for March:     Raw material purchased $42,000   Direct labor payroll  $30,000     Direct labor rate per hour  $ 7.50     Overhead rate per direct labor hour $ 10.00 
Refer to Wyman Enterprises.For March,conversion cost incurred was

Accepted Answer

A) $30,000. 
B) $40,000. 
C) $70,000. 
D) $72,000. 
A) $30,000. 
B) $40,000. 
C) $70,000. 
D) $72,000.

Question 16

Richards Company
The following information has been taken from the cost records of Richards Company for the past year:
Raw material used in production                                                $326
Total manufacturing costs charged to production during            686
the year (includes direct material, direct labor, and
 overhead equal to 50% of direct labor cost)
Cost of goods available for sale                                                  826
Selling and Administrative expenses                                           25
Inventories
BeginingEnding    Raw material  75 $85   Work in process80 30 Finished goods90110
Refer to Richards Company.Cost of Goods Sold was

Accepted Answer

A) $691. 
B) $716. 
C) $736. 
D) $801. 
A) $691. 
B) $716. 
C) $736. 
D) $801.

Question 17

Richards Company
The following information has been taken from the cost records of Richards Company for the past year:
Raw material used in production                                                $326
Total manufacturing costs charged to production during            686
the year (includes direct material, direct labor, and
 overhead equal to 60% of direct labor cost)
Cost of goods available for sale                                                  826
Selling and Administrative expenses                                           25
Inventories
BeginingEnding    Raw material  75 $85   Work in process80 30 Finished goods90110
Refer to Richards Company.The cost of raw material purchased during the year was

Accepted Answer

A) $316. 
B) $336. 
C) $360. 
D) $411. 
A) $316. 
B) $336. 
C) $360. 
D) $411.

Question 18

The three stages of production for a manufacturing firm are _________________________,______________________________,and _________________________.

Accepted Answer

raw materi

Question 19

There is typically an inverse relationship between prevention costs and failure costs.

Accepted Answer

A) True 
 B)False

Question 20

When cost relationships are linear,total variable prime costs will vary in proportion to changes in

Accepted Answer

A) direct labor hours. 
B) total material cost. 
C) total overhead cost. 
D) production volume. 
A) direct labor hours. 
B) total material cost. 
C) total overhead cost. 
D) production volume.

An example of a fixed cost is

Costs that are incurred when customers complain are:

Fixed cost per unit varies directly with production.

Anything for which management wants to accumulate or collect costs is known as a _________________________.

McCoy Company manufactures tables.The beginning balance of Raw Material Inventory was $5,500;raw material purchases of $31,500 were made during the month.At month end,$8,200 of raw material was on hand.Raw material used during the month was

If the cost of an additive is $5,000 + $0.50 for every unit of solvent produced,the cost is classified as a mixed cost.

A mixed cost will be an effective cost driver.

Conversion of inputs to outputs is recorded in the

Costs that are incurred to preclude defects and improper processing are:

What is the difference between a product cost and a period cost? Give three examples of each.What is the difference between a direct cost and indirect cost? Give two examples of each.

Which of the following is not a product cost component?

The indirect costs of converting raw material into finished goods are called

Which of the following defines variable cost behavior? Total cost reaction Cost per unit reaction to increase in activity to increase in activity

The three stages of production for a manufacturing firm are _,,and ___.

There is typically an inverse relationship between prevention costs and failure costs.

When cost relationships are linear,total variable prime costs will vary in proportion to changes in

Introduction to Cost Accounting

Predetermined Overhead Rates, Flexible Budgets, and Absorptionvariable Costing

Activity-Based Management and Activity-Based Costing

Job Order Costing

Process Costing

Standard Costing and Variance Analysis

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting,support Department Allocations,and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters

Inventories:	March 1	March 31
Raw material	$18,000	$15,000
Work in process	9,000	6,000
Finished goods	27,000	36,000
Additional information for March:
Raw material purchased	$42,000
Direct labor payroll	$30,000
Direct labor rate per hour	$ 7.50
Overhead rate per direct labor hour	$ 10.00

Exam 2: Cost Terminology and Cost Behaviors

An example of a fixed cost is

Costs that are incurred when customers complain are:

Fixed cost per unit varies directly with production.

Anything for which management wants to accumulate or collect costs is known as a _________________________.

McCoy Company manufactures tables.The beginning balance of Raw Material Inventory was $5,500;raw material purchases of $31,500 were made during the month.At month end,$8,200 of raw material was on hand.Raw material used during the month was

If the cost of an additive is $5,000 + $0.50 for every unit of solvent produced,the cost is classified as a mixed cost.

A mixed cost will be an effective cost driver.

Conversion of inputs to outputs is recorded in the

Costs that are incurred to preclude defects and improper processing are:

What is the difference between a product cost and a period cost? Give three examples of each.What is the difference between a direct cost and indirect cost? Give two examples of each.

Which of the following is not a product cost component?

The indirect costs of converting raw material into finished goods are called

Which of the following defines variable cost behavior? Total cost reaction Cost per unit reaction to increase in activity to increase in activity

The three stages of production for a manufacturing firm are _________________________,______________________________,and _________________________.

There is typically an inverse relationship between prevention costs and failure costs.

When cost relationships are linear,total variable prime costs will vary in proportion to changes in

Introduction to Cost Accounting

Predetermined Overhead Rates, Flexible Budgets, and Absorptionvariable Costing

Activity-Based Management and Activity-Based Costing

Job Order Costing

Process Costing

Standard Costing and Variance Analysis

The Master Budget

Break-Even Point and Cost-Volume-Profit Analysis

Relevant Information for Decision Making

Allocation of Joint Costs and Accounting for By-Products

Introduction to Cost Management Systems

Responsibility Accounting,support Department Allocations,and Transfer Pricing

Performance Measurement, balanced Scorecards, and Performance Rewards

Capital Budgeting

Managing Costs and Uncertainty

Implementing Quality Concepts

Inventory and Production Management

Emerging Management Practices

Filters

The three stages of production for a manufacturing firm are _,,and ___.