Product Costs That Have Become Expenses Can Be Found in:
FAR EASTERN University
Found of Accounts, Business and Finance
MIDTERM EXAMINATION
SET A
PART I. True or Imitation (Shade A for True, B for False)
1. The sum of all costs that composed humanufacturing costs
except direct materials is chosen manufacturing
overhead.
2. Conversion cost is the sum of direct labor and
manufacturing overhead.
3. Prime number cost is the sum of direct labor and manufacturing
overhead.
iv. Thread used in the product of bed canvas fix, an
indirect material, is classified equally manufacturing
overhead.
5. All costs in a manufacturing company are product costs.
6. The cost of goods sold of a manufacturing company
equals beginning finished goods inventory + cost of
appurtenances manufactured - ending finished goods inventory.
vii. A variable toll is constant if expressed on a per unit
footing but the full dollar amount changes every bit the
number of units' increases or decreases.
8. As activeness increases within the relevant range, fixed
costs remain abiding on a per unit basis.
9. All of the following are examples of opportunity costs:
bacon given up to start a business; rental income given
up when yous live in a house you own; interest income
that could be earned on coin spent for a car.
10. The corporeality that westwardas paid by a company for a building
to house its operations is an example of a sunk cost.
11. The menstruation of costs through the manufacturing accounts is
essentially the aforementioned in both procedure costing and task-
order costing.
12. Companies that use a process-toll bookkeeping system
would establish a carve up Work-in-Process Inventory
account for each manufacturing department.
13. ABC Inc. overstated the percentage of work completed
with respect to conversion cost on the ending work-in-
process inventory. This overstatement caused
conversion-price equivalent unit of measurementdue south to be overstated.
fourteen. Equivalent-unit calculations are necessary to allocate
manufacturing costs betwixt units sold and ending
piece of work in procedure.
15. Equivalent units are computed to assign costs to
partially completed units.
PART 2. Multiple Choice
sixteen. The price of the cushions that are used to manufacture
sofas is best described as a:
a. manufacturing overhead cost.
b. period cost.
c. variable cost.
d. conversion cost.
17. ABC Company articles and sells washing
machines. In order to brand associates of the machines
faster and easier, some of the metal parts in the
machines are coated with grease. How should the cost
of this grease be classified?
Direct Material Toll Fixed Toll
a. Yep Yes
b. Yes No
c. No Yes
d. No No
xviii. A security guard's wages at a factory would exist an
example of:
xix. M
a
n
u
facturing overhead includes:
a.all direct material, direct labor and administrative
costs.
b.all manufacturing costs except direct labor.
c.all manufacturing costs except direct labor and direct
materials.
d.all selling and administrative costs.
20. Materials used in the performance of a manufacturing plant, such as
cleaning supplies, that are not an integral part of the
final product should be classified equally:
a.direct materials.
b.a period toll.
c.administrative expense.
d.manufacturing overhead.
21. The one cost that would be classified equally part of both
prime number cost and conversion cost would be:
a. indirect material.
b. directly labor.
c. direct fabric.
d. indirect labor.
22. Direct costs:
a. are incurred to benefit a particular accounting
period.
b. are incurred due to a specific determination.
c. tin can be easily traced to a detail cost object.
d. are the variable costs of producing a product.
23. Prime costs consist of:
a. straight materials and the variable portion of
manufacturing overhead.
b. direct labor and indirect labor.
c. indirect labor and the fixed portion of
manufacturing overhead.
d. directly labor and direct materials.
Indirect
labor Fixed manufacturing overhead
a. No No
b. Yes Aye
c. Yes No
d. No Yes
Source: https://www.studocu.com/ph/document/far-eastern-university/marketing-management/cost-accounting/8121120
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