Exam 3: Basic Cost Management Concepts

The following information applies to the McAdoo Company for the year. Required: Prepare a statement of cost of goods manufactured and an income statement for the year.

Which of the following best describes a fixed cost?

The range of the cost driver in which the actual value of the cost driver is expected to fall is called the:

If the volume of production is increased over the level planned, the cost per unit would be expected to:

A manager of a large retail firm is interested in knowing what the company's product costs are. Which of the following would be considered a product cost for the manager's company?

Which of the following is normally considered to be a product cost?

What is the amount of direct materials purchased?

What should be the amount of direct materials used?

The following information applies to the Johnson Tools Company for the year. Required: Prepare a statement of cost of goods manufactured and an income statement for the year.

What should be the amount of direct materials purchased?

There is no convenient or economical way to trace a(n) _______ from the cost to the cost pool or from the cost pool to the cost object.

Since indirect cost cannot be conveniently or economically traced directly to a cost pool or cost object, the management accountant will:

A computer virus destroyed some of the accounting records for Hampton Furniture Company for the periods of 2011-2013. The following information was salvaged from the computer system. Required: Determine the correct amounts for A through P.

Cost of goods sold is calculated to be:

Woodcarving Co. incurred the following costs during May: What was the amount of direct materials and direct labor used in May?

Williams Company is an East Coast producer of electronic furnace air filters. A significant jump in new housing starts in the region has triggered a 25 percent increase in orders for the filter units, especially the quality model that Williams sells for $270. Six weeks after increasing production to supply the increased orders, the assistant controller notices some unusual unit cost data in the monthly report she is preparing. Prior and current month unit values are given below: Required: (1) Suggest some possible causes for the decline in average total cost. (2) Assume now the opposite change has occurred, namely, average total cost has risen $3.96 per unit, while unit variable cost has fallen by $3.68 per unit. Suggest a possible situation to explain these changes.

Cost of goods sold is calculated to be:

The term relevant range as used in cost accounting means the range over which:

Cost of goods manufactured is calculated to be:

Choco Chocolata is a cookie company in Juarez, Mexico that produces and sells American-style chocolate chip cookies with extremely high quality and service. The owner would like to identify the various costs incurred during each year in order to plan and control the costs in the business. Chocolata's costs are the following (in thousands of pesos): Required: (1) What is the total amount of product costs? (2) What is the total amount of period costs?