Exam 2: An Introduction to Cost Terms and Purposes

Use the information below to answer the following question(s).Ontario Industries Inc.had the following activities during the year: -What is the amount of direct materials used by Ontario Industries Inc.?

Generally, costs which are initially recorded as an asset and subsequently become an expense are called

Use the information below to answer the following question(s).Frazer Inc.had the following activities in the year: -What is Frazer's cost of goods manufactured?

Which one of the following is a variable cost in a grocery store?

Inventoriable costs are reported as an asset when incurred and expensed on the income statement when the product is sold.

A cost is classified as a direct or indirect cost based on the applicable cost object.

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 worker overtime premiums

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. -Which of the following is a fixed cost for an automobile manufacturing plant?

Parksville, Inc., reports the following information for September: Required: If sales decrease by half in October, what is the projected operating income?

Evans Inc., had the following activities during 2018: Direct materials: Required: a.What is the cost of direct materials used during 2018? b.What is cost of goods manufactured for 2018? c.What is cost of goods sold for 2018? Assume that Evans uses a two-part classification system for prime and conversion costs. d.What amount of prime costs was added to production during 2018? e.What amount of conversion costs was added to production during 2018?

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 -utilities on the factory

Manufacturing sector firms normally hold three types of inventory: direct materials inventory, work-in-process inventory, and finished goods inventory.

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 last year's operating income when the company produced and sold 40,000 units.

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 200,000 units.

Work-in-process consists of partially completed goods not yet ready for sale.

Combs, Inc., reports the following information for September: Required: If sales double in October, what is the projected operating income?

What are the differences between direct costs and indirect costs? Give an example of each.

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year: -Which of the following statements would be correct in a manufacturing business?

Butler Hospital wants to estimate the cost for each patient stay.It is a general health care facility offering only basic services and not specialized services such as organ transplants.Required: a.Classify each of the following costs as either direct or indirect with respect to each patient. b.Classify each of the following costs as either fixed or variable with respect to hospital costs per day.

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. -Variable costs