Question 1

A fixed cost is a cost that changes per unit as cost driver volume changes.

Accepted Answer

A) True 
 B)False

Question 2

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.
-What is the amount of Payton's ending finished goods inventory?

Accepted Answer

A) $99,500 
B) $8,000 
C) $5,000 
D) $500 
E) $0 
A) $99,500 
B) $8,000 
C) $5,000 
D) $500 
E) $0

Question 3

Manufacturing overhead includes

Accepted Answer

A) corporate insurance cost. 
B) the executive officers' salaries. 
C) marketing costs. 
D) supplies used in the human resources department. 
E) plant utilities. 
A) corporate insurance cost. 
B) the executive officers' salaries. 
C) marketing costs. 
D) supplies used in the human resources department. 
E) plant utilities.

Question 4

Fixed costs do not have cost drivers, at least in the short-run.

Accepted Answer

A) True 
 B)False

Question 5

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.
-Fixed costs

Accepted Answer

A) may include either direct or indirect costs. 
B) vary with production or sales volumes. 
C) include parts and materials used to manufacture a product. 
D) can be adjusted in the short run to meet actual demands. 
E) remain fixed regardless of the relevant range of production. 
A) may include either direct or indirect costs. 
B) vary with production or sales volumes. 
C) include parts and materials used to manufacture a product. 
D) can be adjusted in the short run to meet actual demands. 
E) remain fixed regardless of the relevant range of production.

Question 6

Finished goods inventory would normally include

Accepted Answer

A) direct materials in stock and awaiting use in the manufacturing process. 
B) goods partially worked on but not yet fully completed. 
C) goods fully completed but not yet sold. 
D) products in their original form intended to be sold without changing their basic form. 
E) goods completed and sold. 
A) direct materials in stock and awaiting use in the manufacturing process. 
B) goods partially worked on but not yet fully completed. 
C) goods fully completed but not yet sold. 
D) products in their original form intended to be sold without changing their basic form. 
E) goods completed and sold.

Question 7

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

Accepted Answer

A) $216,000 
B) $202,000 
C) $224,000 
D) $225,000 
E) $206,000 
A) $216,000 
B) $202,000 
C) $224,000 
D) $225,000 
E) $206,000

Question 8

Inventoriable costs for merchandising companies are held in the work-in-process account.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements is TRUE?

Accepted Answer

A) Product costs and period costs are the same. 
B) Inventoriable costs are expensed as incurred according to ASPE/IFRS. 
C) Inventoriable costs are costs that remain in inventory after the product is sold. 
D) "Product costs" refers to the particular costs allocated to a product to make a specific decision. 
E) Conversion costs are non-manufacturing costs. 
A) Product costs and period costs are the same. 
B) Inventoriable costs are expensed as incurred according to ASPE/IFRS. 
C) Inventoriable costs are costs that remain in inventory after the product is sold. 
D) "Product costs" refers to the particular costs allocated to a product to make a specific decision. 
E) Conversion costs are non-manufacturing costs.

Question 10

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 last year's operating income when the company produced and sold 120,000 units.

Accepted Answer

A) $0 
B) $ 
C) $ 
D) $ 
E) $ 
A) $0 
B) $ 
C) $ 
D) $ 
E) $

Question 11

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which are e listed below.Match the type of cost with the most appropriate cost pool or as a period cost.
A)Period cost
B)Cost pool - indirect factory operating costs
C)Cost pool - indirect factory labour
D)Cost pool - direct factory labour
-amortization on buildings and equipment

Accepted Answer

The answer of Sheen Manufacturing has four manufacturing cost pools...

Question 12

Cost allocation is

Accepted Answer

A) the process of tracking both direct and indirect costs associated to a cost object. 
B) the process of determining the actual cost of the cost object. 
C) the assignment of indirect costs to the chosen cost object. 
D) a function of cost tracing. 
E) the assignment of direct costs to the chosen cost object. 
A) the process of tracking both direct and indirect costs associated to a cost object. 
B) the process of determining the actual cost of the cost object. 
C) the assignment of indirect costs to the chosen cost object. 
D) a function of cost tracing. 
E) the assignment of direct costs to the chosen cost object.

Question 13

Rent for the building that contains the manufacturing and engineering departments can all be charged as manufacturing overhead costs.

Accepted Answer

A) True 
 B)False

Question 14

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.
-The relevant range is important because

Accepted Answer

A) it specifies which costs should be used for a given decision. 
B) it provides a basis for determining a range of acceptable cost alternatives. 
C) it is required to determine inventoriable costs under ASPE/IFRS. 
D) it specifies the limits beyond which the relationship of cost to cost drivers may not be valid. 
E) it determines the time horizon. 
A) it specifies which costs should be used for a given decision. 
B) it provides a basis for determining a range of acceptable cost alternatives. 
C) it is required to determine inventoriable costs under ASPE/IFRS. 
D) it specifies the limits beyond which the relationship of cost to cost drivers may not be valid. 
E) it determines the time horizon.

Question 15

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which are e listed below.Match the type of cost with the most appropriate cost pool or as a period cost.
A)Period cost
B)Cost pool - indirect factory operating costs
C)Cost pool - indirect factory labour
D)Cost pool - direct factory labour
-factory supervisor's salaries

Accepted Answer

The answer of Sheen Manufacturing has four manufacturing cost pools...

Question 16

Whippany manufacturing wants to estimate costs for each product they produce at its Troy plant.The Troy plant produces three products at this plant, and runs two flexible assembly lines.Each assembly line can produce all three products.Required:
a.Classify each of the following costs as either direct or indirect for each product.
b.Classify each of the following costs as either fixed or variable with respect to the number of units produced of each product.

Accepted Answer

The answer of Whippany manufacturing wants to estimate costs for...

Question 17

Manufacturing-sector companies purchase materials and other resources for conversion into various finished goods.

Accepted Answer

A) True 
 B)False

Question 18

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.
-Cost behaviour refers to

Accepted Answer

A) how costs react to a change in the level of activity. 
B) whether a cost is incurred in a manufacturing, merchandising, or service company. 
C) classifying costs as either inventoriable or period costs. 
D) whether a particular expense has been ethically incurred. 
E) how costs react to a change in selling price. 
A) how costs react to a change in the level of activity. 
B) whether a cost is incurred in a manufacturing, merchandising, or service company. 
C) classifying costs as either inventoriable or period costs. 
D) whether a particular expense has been ethically incurred. 
E) how costs react to a change in selling price.

Question 19

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year:
  
-Goods available for sale that are not in ending inventory

Accepted Answer

A) are included in goods available for sale in the next year. 
B) are included in the work-in-process inventory at the end of the year. 
C) are not accounted for until the next year. 
D) are incorporated in the cost of goods sold amount. 
E) are included in beginning inventory. 
A) are included in goods available for sale in the next year. 
B) are included in the work-in-process inventory at the end of the year. 
C) are not accounted for until the next year. 
D) are incorporated in the cost of goods sold amount. 
E) are included in beginning inventory.

Question 20

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 real estate agent at Larson Real Estate

Accepted Answer

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

A fixed cost is a cost that changes per unit as cost driver volume changes.

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. -What is the amount of Payton's ending finished goods inventory?

Manufacturing overhead includes

Fixed costs do not have cost drivers, at least in the short-run.

Finished goods inventory would normally include

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

Inventoriable costs for merchandising companies are held in the work-in-process account.

Which of the following statements is TRUE?

Cost allocation is

Rent for the building that contains the manufacturing and engineering departments can all be charged as manufacturing overhead costs.

Manufacturing-sector companies purchase materials and other resources for conversion into various finished goods.

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year: -Goods available for sale that are not in ending inventory

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

A fixed cost is a cost that changes per unit as cost driver volume changes.

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. -What is the amount of Payton's ending finished goods inventory?

Manufacturing overhead includes

Fixed costs do not have cost drivers, at least in the short-run.

Finished goods inventory would normally include

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

Inventoriable costs for merchandising companies are held in the work-in-process account.

Which of the following statements is TRUE?

Cost allocation is

Rent for the building that contains the manufacturing and engineering departments can all be charged as manufacturing overhead costs.

Manufacturing-sector companies purchase materials and other resources for conversion into various finished goods.

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year: -Goods available for sale that are not in ending inventory

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