Question 1

When calculating the absorption-costing income for external reporting, all

Accepted Answer

A)  manufacturing costs ultimately become nonmanufacturing costs. 
B)  manufacturing costs are product costs and product costs are never expensed. 
C)  costs of selling manufactured products are classified as product costs. 
D)  selling and administrative costs are classified as nonmanufacturing costs. 
A)  manufacturing costs ultimately become nonmanufacturing costs. 
B)  manufacturing costs are product costs and product costs are never expensed. 
C)  costs of selling manufactured products are classified as product costs. 
D)  selling and administrative costs are classified as nonmanufacturing costs.

Question 2

Conversion costs do NOT include

Accepted Answer

A)  direct materials. 
B)  direct labor. 
C)  factory overhead. 
D)  any of these costs. 
A)  direct materials. 
B)  direct labor. 
C)  factory overhead. 
D)  any of these costs.

Question 3

In a company that supplies muffins to bakeries, delivered muffins to bakeries would be a(n)

Accepted Answer

A)  interrelated part. 
B)  input. 
C)  output. 
D)  process. 
A)  interrelated part. 
B)  input. 
C)  output. 
D)  process.

Question 4

Figure 2-15 Information from the records of Chrome Ponies Enterprises for June 2014 is as follows:
    Refer to Figure 2-15. What is the cost of goods sold?

Accepted Answer

A)  $36,500 
B)  $28,600 
C)  $29,400 
D)  $29,500 
A)  $36,500 
B)  $28,600 
C)  $29,400 
D)  $29,500

Question 5

An example of a nonproduction cost is

Accepted Answer

A)  wages paid to assembly-line employees. 
B)  manufacturing supplies. 
C)  insurance on manufacturing facilities. 
D)  the treasurer's salary. 
A)  wages paid to assembly-line employees. 
B)  manufacturing supplies. 
C)  insurance on manufacturing facilities. 
D)  the treasurer's salary.

Question 6

With regard to services, inseparability means that

Accepted Answer

A)  products cannot be stored. 
B)  direct contact must take place for an exchange. 
C)  products have a physical presence. 
D)  none of the above apply to inseparability. 
A)  products cannot be stored. 
B)  direct contact must take place for an exchange. 
C)  products have a physical presence. 
D)  none of the above apply to inseparability.

Question 7

The merchandise inventory in a merchandising business corresponds most closely to which of the following items in a manufacturing firm?

Accepted Answer

A)  materials inventory 
B)  cost of goods available for sale 
C)  cost of goods manufactured 
D)  finished goods inventory 
A)  materials inventory 
B)  cost of goods available for sale 
C)  cost of goods manufactured 
D)  finished goods inventory

Question 8

The system that focuses on the management of activities with the objective of improving the value received by the customer and the profit received by providing this value is called.

Accepted Answer

A)  Activity-based management 
B)  Contemporary cost control 
C)  Functional-based cost management system 
D)  JIT 
A)  Activity-based management 
B)  Contemporary cost control 
C)  Functional-based cost management system 
D)  JIT

Question 9

Which of the following costs would be included in traditional product costs used for external reporting?

Accepted Answer

A)  research and development 
B)  production 
C)  marketing 
D)  all of the above 
A)  research and development 
B)  production 
C)  marketing 
D)  all of the above

Question 10

What is a disadvantage of assigning costs evenly over all cost objects?

Accepted Answer

A)  not all costs will be assigned 
B)  total costs will be distorted 
C)  costs may be distorted by consumption patterns of other cost objects 
D)  none of these 
A)  not all costs will be assigned 
B)  total costs will be distorted 
C)  costs may be distorted by consumption patterns of other cost objects 
D)  none of these

Question 11

Traceability is a function of

Accepted Answer

A)  an indirect relationship to the cost object. 
B)  distortion. 
C)  a causal relationship. 
D)  none of these. 
A)  an indirect relationship to the cost object. 
B)  distortion. 
C)  a causal relationship. 
D)  none of these.

Question 12

The optimal level in the trade-off between measurement and error costs is when

Accepted Answer

A)  measurement costs are greater than error costs. 
B)  measurement costs and error costs are minimized. 
C)  measurement costs are less than error costs. 
D)  the total of measurement costs and error costs are maximized. 
A)  measurement costs are greater than error costs. 
B)  measurement costs and error costs are minimized. 
C)  measurement costs are less than error costs. 
D)  the total of measurement costs and error costs are maximized.

Question 13

Wages paid to a janitor in the factory would be classified as

Accepted Answer

A)  direct labor. 
B)  direct janitor salaries. 
C)  supervisor salaries. 
D)  factory overhead. 
A)  direct labor. 
B)  direct janitor salaries. 
C)  supervisor salaries. 
D)  factory overhead.

Question 14

The most precise of the three methods of cost assignment is direct tracing since it relies on observable causal relationships.

Accepted Answer

A) True 
 B)False

Question 15

Production costs are costs associated with manufacturing goods or providing services and are classified as direct materials, direct labor, and overhead.

Accepted Answer

A) True 
 B)False

Question 16

Rebel Yell, Inc., recorded the following data for April:   What is the cost of goods manufactured for April?

Accepted Answer

A)  $470,000 
B)  $420,000 
C)  $460,000 
D)  $430,000 
A)  $470,000 
B)  $420,000 
C)  $460,000 
D)  $430,000

Question 17

Which of the following is NOT one of the features of an operational control information system?

Accepted Answer

A)  to assist in continuous improvement of all aspects of the business 
B)  to improve the value received by customers 
C)  to provide product cost information needed by management 
D)  to improve profits by improving value 
A)  to assist in continuous improvement of all aspects of the business 
B)  to improve the value received by customers 
C)  to provide product cost information needed by management 
D)  to improve profits by improving value

Question 18

In a traditional manufacturing company, product costs include

Accepted Answer

A)  direct materials only. 
B)  direct materials, direct labor, and factory overhead. 
C)  direct materials and direct labor only. 
D)  direct labor only. 
A)  direct materials only. 
B)  direct materials, direct labor, and factory overhead. 
C)  direct materials and direct labor only. 
D)  direct labor only.

Question 19

Which of the following costs would NOT be included in operating product costs?

Accepted Answer

A)  production 
B)  marketing 
C)  research and development 
D)  all of the above 
A)  production 
B)  marketing 
C)  research and development 
D)  all of the above

Question 20

Costs that are expensed in the period in which they are incurred are called:

Accepted Answer

A)  Direct materials costs 
B)  Product costs 
C)  Noninventoriable costs 
D)  Inventoriable costs 
A)  Direct materials costs 
B)  Product costs 
C)  Noninventoriable costs 
D)  Inventoriable costs

When calculating the absorption-costing income for external reporting, all

Conversion costs do NOT include

In a company that supplies muffins to bakeries, delivered muffins to bakeries would be a(n)

Figure 2-15 Information from the records of Chrome Ponies Enterprises for June 2014 is as follows: Refer to Figure 2-15. What is the cost of goods sold?

An example of a nonproduction cost is

With regard to services, inseparability means that

The merchandise inventory in a merchandising business corresponds most closely to which of the following items in a manufacturing firm?

The system that focuses on the management of activities with the objective of improving the value received by the customer and the profit received by providing this value is called.

Which of the following costs would be included in traditional product costs used for external reporting?

What is a disadvantage of assigning costs evenly over all cost objects?

Traceability is a function of

The optimal level in the trade-off between measurement and error costs is when

Wages paid to a janitor in the factory would be classified as

The most precise of the three methods of cost assignment is direct tracing since it relies on observable causal relationships.

Production costs are costs associated with manufacturing goods or providing services and are classified as direct materials, direct labor, and overhead.

Rebel Yell, Inc., recorded the following data for April: What is the cost of goods manufactured for April?

Which of the following is NOT one of the features of an operational control information system?

In a traditional manufacturing company, product costs include

Which of the following costs would NOT be included in operating product costs?

Costs that are expensed in the period in which they are incurred are called:

Introduction to Cost Management

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control Key

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters

Exam 2: Basic Cost Management Concepts

When calculating the absorption-costing income for external reporting, all

Conversion costs do NOT include

In a company that supplies muffins to bakeries, delivered muffins to bakeries would be a(n)

Figure 2-15 Information from the records of Chrome Ponies Enterprises for June 2014 is as follows: Refer to Figure 2-15. What is the cost of goods sold?

An example of a nonproduction cost is

With regard to services, inseparability means that

The merchandise inventory in a merchandising business corresponds most closely to which of the following items in a manufacturing firm?

The system that focuses on the management of activities with the objective of improving the value received by the customer and the profit received by providing this value is called.

Which of the following costs would be included in traditional product costs used for external reporting?

What is a disadvantage of assigning costs evenly over all cost objects?

Traceability is a function of

The optimal level in the trade-off between measurement and error costs is when

Wages paid to a janitor in the factory would be classified as

The most precise of the three methods of cost assignment is direct tracing since it relies on observable causal relationships.

Production costs are costs associated with manufacturing goods or providing services and are classified as direct materials, direct labor, and overhead.

Rebel Yell, Inc., recorded the following data for April: What is the cost of goods manufactured for April?

Which of the following is NOT one of the features of an operational control information system?

In a traditional manufacturing company, product costs include

Which of the following costs would NOT be included in operating product costs?

Costs that are expensed in the period in which they are incurred are called:

Introduction to Cost Management

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control Key

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters