Exam 2: An Introduction to Cost Terms and Purposes

Overtime premium is normally considered as a component of direct labour.

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 -idle time wages

Product costs used for pricing and product-mix decisions generally include

Big Bird Pet Store had the following financial activities for June.Revenue was $860,000 with cost of goods sold equalling $440,000.Salaries and wages of all employees were $100,000.Fringe benefits were 15 percent of salaries and wages.Rent on the building was $100,000 and equipment amortization was $46,000.Office supplies and utilities totalled $28,000.Income taxes withheld from employees totalled $46,000 for the month while ending accounts payable were $24,680.Cash flows from accounts receivable totalled $880,000.Required: Using an income statement format, determine the operating income of the store.

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 -night security

Which of the following is an indirect production cost?

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 -depreciation on freezers at Gregory Food Retailing

What is the meaning of the term "cost object"? Give an example of a cost object that would be used in a manufacturing company, a merchandising company, and a service sector company?

Wages paid to machine operators on an assembly line are an example of which type of cost?

The vice president of production has just completed the January meeting with all production department heads.Everyone is upset that the production variances for the month were unfavourable.They do not understand why everything was unfavourable.January is typically the company's lowest production month of the year.The company uses annual average unit costs for production evaluation purposes.The average costs are based on the prior year's actual performance with adjustments for any predicted changes in the coming year.Both production and economic items are considered in setting the averages for each new year.Required: Explain the problems with using average costs in evaluating production.

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 -safety hats and shoes

"Cost" is defined by accountants as a resource sacrificed or foregone to achieve a specific objective.

A cost object is anything for which a separate measurement of costs is desired.

Which one of the following items is typically an example of an indirect cost of a cost object?

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 -purchase of frozen food for sale to customers by Gregory Food Retailers

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 direct materials for 2019 assuming direct materials are for the production of 507,000 units?

Which of the following is a cost object?

Costs of Sales is another way of phrasing Cost of Goods Sold.

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. -A mixed cost is

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 -salaries of Bedell's assembly line workers