Question 1

For purposes of calculating inventory costs under ASPE/IFRS, only production costs can be used.

Accepted Answer

A) True 
 B)False  True

Question 2

Explain the difference between an inventoriable cost and a period cost.What potential problems does an inaccurate classification of product and period costs cause?

Accepted Answer

Inventoriable costs are all costs of a product that are considered as assets in the balance sheet when they are incurred and which become cost of goods sold only when the product is sold.Period costs are treated as expenses of the accounting period in which they are incurred.An inaccurate classification of inventoriable and period costs could lead to violations of the matching principle, which states that costs used in producing revenue should be matched on the income statement when the revenue is recognized.In extreme cases, net income for a given period might be significantly misstated if proper matching does not occur.

Question 3

Use the information below to answer the following question(s).Consider the following data of the Vancouver Company for the year 2019:
  
-What is the unit cost for the plant leasing cost for 2016 assuming plant leasing costs are for the production of 2,000,000 units?

Accepted Answer

A) 0.35 
B) 0.18 
C) 0.12 
D) 0.06 
E) 0.04 
A) 0.35 
B) 0.18 
C) 0.12 
D) 0.06 
E) 0.04 D

Question 4

Answer the following question(s)using the information below.The West Company manufactures several different products.Unit costs associated with Product ORD203 are as follows:
  
-What are the variable costs per unit associated with Product ORD203?

Accepted Answer

A) $60 
B) $83 
C) $66 
D) $48 
E) $12 
A) $60 
B) $83 
C) $66 
D) $48 
E) $12

Question 5

The following information is taken from the records of Britton Company for March:
Purchases:

Accepted Answer

@#IMG-DLM& c.Prime costs $11,800,000
Con

Question 6

Boone Hospital wants to determine, to the extent possible, the actual cost for each patient stay.It is a general health care facility with all basic services but does not perform specialized services such as organ transplants.Required:
Complete the following table by
a.Classifying each cost as a direct or indirect cost with respect to each patient.
b.Classifying each item as fixed or variable with respect to the number of patient days (sum of days each patient was in hospital)the hospital incurs.

Accepted Answer

The answer of Boone Hospital wants to determine, to the...

Question 7

Each of the following items pertains to one of these companies: Bedell Electronics (a manufacturing company), Gregory Food Retailers (a merchandising company), and Larson Real Estate (a service sector company).Match each item with either an inventoriable cost or a period cost.
A)inventoriable
B)period
-salary of a receptionist at Larson Real Estate

Accepted Answer

The answer of Each of the following items pertains to...

Question 8

Use the information below to answer the following question(s).The following information pertains to Payton's Shoe Manufacturing:
   99,500 pairs of shoes are sold during the year for $18.
-The following information pertains to the Stratford Company:   What is the cost of goods sold?

Accepted Answer

A) $436,000 
B) $384,000 
C) $376,000 
D) $316,000 
E) $444,000 
A) $436,000 
B) $384,000 
C) $376,000 
D) $316,000 
E) $444,000

Question 9

Cost assignment is

Accepted Answer

A) always arbitrary. 
B) linking actual costs to cost objects. 
C) the same as cost accumulation. 
D) finding the difference between budgeted and actual costs. 
E) the same as cost conversion. 
A) always arbitrary. 
B) linking actual costs to cost objects. 
C) the same as cost accumulation. 
D) finding the difference between budgeted and actual costs. 
E) the same as cost conversion.

Question 10

Use the information below to answer the following question(s).Montreal Industries Inc.had the following activities during the year:
  
-What is Montreal's cost of goods sold during the year?

Accepted Answer

A) $260,000 
B) $232,000 
C) $220,000 
D) $200,000 
E) $240,000 
A) $260,000 
B) $232,000 
C) $220,000 
D) $200,000 
E) $240,000

Question 11

Use the information below to answer the following question(s).Macadamia Co.produced and sold 40,000 units last year.Per unit revenue and costs were as follows:
   Fixed manufacturing overhead and administrative salaries are fixed costs.The per unit amounts are based on last year's production.
-Calculate this year's operating income if the company plans to produce and sell 50,000 units.

Accepted Answer

A) $50,000 
B) $0 
C) $ 
D) $ 
E) $250,000 
A) $50,000 
B) $0 
C) $ 
D) $ 
E) $250,000

Question 12

Overtime premium consists of the wages paid to all workers (for both direct labour and indirect labour)in excess of their straight-time wage rates.

Accepted Answer

A) True 
 B)False

Question 13

Period costs are never included as part of inventory.

Accepted Answer

A) True 
 B)False

Question 14

Answer the following question(s)using the information below.The Singer Company manufactures several different products.Unit costs associated with Product ICT101 are as follows:
  
-What are the inventoriable costs per unit associated with Product ICT101?

Accepted Answer

A) $120 
B) $140 
C) $50 
D) $88 
E) $70 
A) $120 
B) $140 
C) $50 
D) $88 
E) $70

Question 15

When a manager is making a decision based on cost figures, it is preferable that he (she)thinks in terms of unit costs.

Accepted Answer

A) True 
 B)False

Question 16

Describe a variable cost.Describe a fixed cost.Explain why the distinction between variable and fixed costs is important in cost accounting.

Accepted Answer

Total variable costs increase with incre

Question 17

A manufacturing company contracts with the labour union to guarantee full employment for all employees with at least 10 years seniority.The Company expects to be working at capacity for the next 2 years (the life of the contract), so this was seen as a bargaining concession without any cost to the company.On average, an employee earns $30 per hour, including benefits.The work force consists of 800 employees, with seniority ranging from 1 year to 18 years.Required:
Analyze the direct labour cost in term of variable costs, fixed costs, and the relevant range.

Accepted Answer

Usually, we think of direct labour as a

Question 18

Unit costs are considered to be an average cost per unit.

Accepted Answer

A) True 
 B)False

Question 19

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year:
  
-For a manufacturing company, direct material costs may be included in

Accepted Answer

A) direct materials inventory only. 
B) merchandise inventory only. 
C) both work-in-process inventory and finished goods inventory. 
D) direct materials inventory, work-in-process inventory, and finished goods inventory accounts. 
E) period costs. 
A) direct materials inventory only. 
B) merchandise inventory only. 
C) both work-in-process inventory and finished goods inventory. 
D) direct materials inventory, work-in-process inventory, and finished goods inventory accounts. 
E) period costs.

Question 20

Use the information below to answer the following question(s).Big Island Coffee Co.produced and sold 120,000 units last year.Per unit revenue and costs were as follows:
   Fixed manufacturing overhead and administrative salaries are fixed costs.The per unit amounts are based on last year's production.
-Calculate this year's operating income if the company plans to produce and sell 60,000 units.

Accepted Answer

A) $120,000 
B) $0 
C) $ 
D) $ 
E) $ 
A) $120,000 
B) $0 
C) $ 
D) $ 
E) $

For purposes of calculating inventory costs under ASPE/IFRS, only production costs can be used.

Explain the difference between an inventoriable cost and a period cost.What potential problems does an inaccurate classification of product and period costs cause?

Use the information below to answer the following question(s).Consider the following data of the Vancouver Company for the year 2019: -What is the unit cost for the plant leasing cost for 2016 assuming plant leasing costs are for the production of 2,000,000 units?

Answer the following question(s)using the information below.The West Company manufactures several different products.Unit costs associated with Product ORD203 are as follows: -What are the variable costs per unit associated with Product ORD203?

The following information is taken from the records of Britton Company for March: Purchases:

Use the information below to answer the following question(s).The following information pertains to Payton's Shoe Manufacturing: 99,500 pairs of shoes are sold during the year for $18. -The following information pertains to the Stratford Company: What is the cost of goods sold?

Cost assignment is

Use the information below to answer the following question(s).Montreal Industries Inc.had the following activities during the year: -What is Montreal's cost of goods sold during the year?

Overtime premium consists of the wages paid to all workers (for both direct labour and indirect labour)in excess of their straight-time wage rates.

Period costs are never included as part of inventory.

Answer the following question(s)using the information below.The Singer Company manufactures several different products.Unit costs associated with Product ICT101 are as follows: -What are the inventoriable costs per unit associated with Product ICT101?

When a manager is making a decision based on cost figures, it is preferable that he (she)thinks in terms of unit costs.

Describe a variable cost.Describe a fixed cost.Explain why the distinction between variable and fixed costs is important in cost accounting.

Unit costs are considered to be an average cost per unit.

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year: -For a manufacturing company, direct material costs may be included in

The Accountants Vital Role in Decision Making

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Master Budget and Responsibility Accounting

Flexible Budgets, Variances, and Management Control: I

Flexible Budgets, Variances, and Management Control: II

Income Effects of Denominator Level on Inventory Valuation

Analysis of Cost Behaviour

Decision Making and Relevant Information

Pricing Decisions, Product Profitability Decisions, and Cost Management

Strategy, Balanced Scorecard, and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, Rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters

Exam 2: An Introduction to Cost Terms and Purposes

For purposes of calculating inventory costs under ASPE/IFRS, only production costs can be used.

Explain the difference between an inventoriable cost and a period cost.What potential problems does an inaccurate classification of product and period costs cause?

Use the information below to answer the following question(s).Consider the following data of the Vancouver Company for the year 2019: -What is the unit cost for the plant leasing cost for 2016 assuming plant leasing costs are for the production of 2,000,000 units?

Answer the following question(s)using the information below.The West Company manufactures several different products.Unit costs associated with Product ORD203 are as follows: -What are the variable costs per unit associated with Product ORD203?

The following information is taken from the records of Britton Company for March: Purchases:

Use the information below to answer the following question(s).The following information pertains to Payton's Shoe Manufacturing: 99,500 pairs of shoes are sold during the year for $18. -The following information pertains to the Stratford Company: What is the cost of goods sold?

Cost assignment is

Use the information below to answer the following question(s).Montreal Industries Inc.had the following activities during the year: -What is Montreal's cost of goods sold during the year?

Overtime premium consists of the wages paid to all workers (for both direct labour and indirect labour)in excess of their straight-time wage rates.

Period costs are never included as part of inventory.

Answer the following question(s)using the information below.The Singer Company manufactures several different products.Unit costs associated with Product ICT101 are as follows: -What are the inventoriable costs per unit associated with Product ICT101?

When a manager is making a decision based on cost figures, it is preferable that he (she)thinks in terms of unit costs.

Describe a variable cost.Describe a fixed cost.Explain why the distinction between variable and fixed costs is important in cost accounting.

Unit costs are considered to be an average cost per unit.

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year: -For a manufacturing company, direct material costs may be included in

The Accountants Vital Role in Decision Making

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Management

Master Budget and Responsibility Accounting

Flexible Budgets, Variances, and Management Control: I

Flexible Budgets, Variances, and Management Control: II

Income Effects of Denominator Level on Inventory Valuation

Analysis of Cost Behaviour

Decision Making and Relevant Information

Pricing Decisions, Product Profitability Decisions, and Cost Management

Strategy, Balanced Scorecard, and Profitability Analysis

Period Cost Allocation

Cost Allocation: Joint Products and Byproducts

Revenue and Customer Profitability Analysis

Process Costing

Spoilage, Rework, and Scrap

Inventory Cost Management Strategies

Capital Budgeting: Methods of Investment Analysis

Transfer Pricing and Multinational Management Control Systems

Multinational Performance Measurement and Compensation

Filters