Question 1

A cost that remains constant in total but varies on a per-unit basis with changes in activity is called a(n)

Accepted Answer

A) expired cost. 
B) fixed cost. 
C) variable cost. 
D) mixed cost. 
A) expired cost. 
B) fixed cost. 
C) variable cost. 
D) mixed cost.

Question 2

Given the following information for Gregg Corporation,prepare the necessary journal entries,assuming that the Raw Material Inventory account contains both direct and indirect material.
a.	Purchased raw material on account $45,500.
b.	Put material into production: $28,000 of direct material and $5,000 of indirect material.
c.	Accrued payroll of $95,000, of which 65 percent was direct and the remainder was indirect.
d.	Incurred and paid other overhead items of $42,000.
e.	Transferred items costing $92,500 to finished goods.
f.	Sold goods costing $79,900 on account for $134,200.

Accepted Answer

a. RM Inventory 45,500
@#LAT-DLM&45,500
b. WIP Inv

Question 3

Product costs are deducted from revenue

Accepted Answer

A) as expenditures are made. 
B) when production is completed. 
C) as goods are sold. 
D) to minimize taxable income. 
A) as expenditures are made. 
B) when production is completed. 
C) as goods are sold. 
D) to minimize taxable income.

Question 4

Plastic used to manufacture dolls is a
prime cost        product cost     direct cost    fixed cost

Accepted Answer

A) no yes yes yes 
B) yes no yes no 
C) yes yes no yes 
D) yes yes yes no 
A) no yes yes yes 
B) yes no yes no 
C) yes yes no yes 
D) yes yes yes no

Question 5

A cost that varies inversely with the level of production is known as a ____________________ cost.

Accepted Answer

The answer of A cost that varies inversely with the...

Question 6

A cost that varies in total in direct proportion to changes in activity is known as a ____________________ cost

Accepted Answer

The answer of A cost that varies in total in...

Question 7

Distribution costs are an example of product costs.

Accepted Answer

A) True 
 B)False

Question 8

A fixed cost remains constant on a per-unit basis as production changes.

Accepted Answer

A) True 
 B)False

Question 9

In an actual cost system,overhead is assigned to Work in Process Inventory with a debit entry to the account.

Accepted Answer

A) True 
 B)False

Question 10

Costs that can be conveniently traced to a cost object are referred to as ____________________ costs.

Accepted Answer

The answer of Costs that can be conveniently traced to...

Question 11

Cost of Goods Sold is an

Accepted Answer

A) unexpired product cost. 
B) expired product cost. 
C) unexpired period cost. 
D) expired period cost. 
A) unexpired product cost. 
B) expired product cost. 
C) unexpired period cost. 
D) expired period cost.

Question 12

Conversion cost does not include

Accepted Answer

A) direct labor. 
B) direct material. 
C) factory depreciation. 
D) supervisors' salaries. 
A) direct labor. 
B) direct material. 
C) factory depreciation. 
D) supervisors' salaries.

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

A variable cost remains constant on a per-unit basis as production increases.

Accepted Answer

A) True 
 B)False

Question 15

Costs that are incurred for monitoring and inspecting 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 16

Why should predetermined overhead rates be used?

Accepted Answer

Predetermined overhead rates should be u

Question 17

The formula for cost of goods sold for a manufacturer is

Accepted Answer

A) beginning Finished Goods Inventory plus Cost of Goods Manufactured minus ending Finished Goods Inventory. 
B) beginning Work in Process Inventory plus Cost of Goods Manufactured minus ending Work in Process Inventory. 
C) direct material plus direct labor plus applied overhead. 
D) direct material plus direct labor plus overhead incurred plus beginning Work in Process Inventory. 
A) beginning Finished Goods Inventory plus Cost of Goods Manufactured minus ending Finished Goods Inventory. 
B) beginning Work in Process Inventory plus Cost of Goods Manufactured minus ending Work in Process Inventory. 
C) direct material plus direct labor plus applied overhead. 
D) direct material plus direct labor plus overhead incurred plus beginning Work in Process Inventory.

Question 18

The following information was taken from the records of the Slidell Corporation for the month of July.(There were no inventories of work in process or finished goods on July 1. )
                  Units       Cost                      Sales during month       8,000       $?                      Manufacturing costs for month:                                           Direct material              32,000                      Direct labor              20,000                      Overhead costs applied              15,000                      Overhead costs under-applied              800               Inventories, July 31:                                           Work in process       1,000       ?                      Finished goods       2,000       ?       
 Indirect manufacturing costs are applied on a direct labor cost basis.The under-applied balance is due to seasonal variations and will be carried forward.The following cost estimates have been submitted for the work in process inventory of July 31: material,$3,000;direct labor,$2,000.
Required:
a.Determine the number of units that were completed and transferred to finished goods during the month.
b.Complete the estimate of the cost of work in process on July 31.
c.Compute cost of goods manufactured for the month.
d.Determine the cost of each unit completed during the month.
e.Determine the total amount debited to the Overhead Control accounts during the month.

Accepted Answer

The answer of The following information was taken from the...

Question 19

A cost that remains constant on a per unit basis within the relevant range is a ____________________ cost.

Accepted Answer

The answer of A cost that remains constant on a...

Question 20

In a normal cost system,actual production overhead costs are typically accumulated in an Overhead Control account and assigned to Work in Process at the end of the period.

Accepted Answer

A) True 
 B)False

A cost that remains constant in total but varies on a per-unit basis with changes in activity is called a(n)

Product costs are deducted from revenue

Plastic used to manufacture dolls is a prime cost product cost direct cost fixed cost

A cost that varies inversely with the level of production is known as a ____________________ cost.

A cost that varies in total in direct proportion to changes in activity is known as a ____________________ cost

Distribution costs are an example of product costs.

A fixed cost remains constant on a per-unit basis as production changes.

In an actual cost system,overhead is assigned to Work in Process Inventory with a debit entry to the account.

Costs that can be conveniently traced to a cost object are referred to as ____________________ costs.

Cost of Goods Sold is an

Conversion cost does not include

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

A variable cost remains constant on a per-unit basis as production increases.

Costs that are incurred for monitoring and inspecting are:

Why should predetermined overhead rates be used?

The formula for cost of goods sold for a manufacturer is

A cost that remains constant on a per unit basis within the relevant range is a ____________________ cost.

In a normal cost system,actual production overhead costs are typically accumulated in an Overhead Control account and assigned to Work in Process at the end of the period.

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

	Units	Cost
Sales during month	8,000	$?
Manufacturing costs for month:
	Direct material		32,000
	Direct labor		20,000
	Overhead costs applied		15,000
	Overhead costs under-applied		800
Inventories, July 31:
	Work in process	1,000	?
	Finished goods	2,000	?

Exam 2: Cost Terminology and Cost Behaviors

A cost that remains constant in total but varies on a per-unit basis with changes in activity is called a(n)

Product costs are deducted from revenue

Plastic used to manufacture dolls is a prime cost product cost direct cost fixed cost

A cost that varies inversely with the level of production is known as a ____________________ cost.

A cost that varies in total in direct proportion to changes in activity is known as a ____________________ cost

Distribution costs are an example of product costs.

A fixed cost remains constant on a per-unit basis as production changes.

In an actual cost system,overhead is assigned to Work in Process Inventory with a debit entry to the account.

Costs that can be conveniently traced to a cost object are referred to as ____________________ costs.

Cost of Goods Sold is an

Conversion cost does not include

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

A variable cost remains constant on a per-unit basis as production increases.

Costs that are incurred for monitoring and inspecting are:

Why should predetermined overhead rates be used?

The formula for cost of goods sold for a manufacturer is

A cost that remains constant on a per unit basis within the relevant range is a ____________________ cost.

In a normal cost system,actual production overhead costs are typically accumulated in an Overhead Control account and assigned to Work in Process at the end of the period.

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