Exam 2: Cost Concepts and Behavior

A company which manufactures custom-made machinery routinely incurs sizable telephone costs in the process of taking sales orders from customers.Which of the following is a proper classification of this cost?

Manufacturing overhead:

The three basic elements of manufacturing cost are direct materials,direct labor,and:

How would miscellaneous supplies used in assembling a product be classified for a manufacturing company?

The range within which fixed costs remain constant as volume of activity varies is known as the relevant range.This statement is the definition of a relevant range.

Laner Company has the following data for the production and sale of 2,000 units. What is the total manufacturing cost per unit?

Micro Computer Company has set up a toll-free telephone line for customer inquiries regarding computer hardware produced by the company.The cost of this toll-free line would be classified as which of the following?

Absorption costing measures contribution to profit as:

Fixed costs per unit change inversely with changes in the volume of activity.Fixed costs per unit would vary inversely with the volume of activity.

Which of the following statements is (are)true? (1).The term full cost refers to the cost of manufacturing and selling a unit of product and includes both fixed and variable costs.(2).The fixed cost per unit is considered constant despite changes in volume of activity within the relevant range.

Waupun Company has the following unit costs: What cost per unit would be used for product costing under variable costing?

Transportation costs incurred by a manufacturing company to ship its product to its customers would be classified as which of the following?

Under full absorption costing,which of the following are included in product costs?

A company had beginning inventories as follows: Direct Materials,$300;Work-in-Process,$500;Finished Goods,$700.It had ending inventories as follows: Direct Materials,$400;Work-in-Process,$600;Finished Goods,$800.Material Purchases (net including freight)were $1,400,Direct Labor $1,500,and Manufacturing Overhead $1,600.What is the Cost of Goods Sold for the period?

An asset is a cost matched with revenues in a future accounting period.This statement is the definition of asset.

During the year,a manufacturing company had the following operating results: What is the cost of goods manufactured for the year?

The student health center employs one doctor,three nurses,and several other employees.How would you classify (1)the nurses' salary and (2)film and other materials used in radiology to give X-rays to students? Assume the activity is the number of students visiting the health center.

Laner Company has the following data for the production and sale of 2,000 units. What is the prime cost per unit?

Cheboygan Company has the following unit costs: Cheboygan produced and sold 10,000 units.If the product sells for $100,what is the gross margin?

Period costs are those costs assigned to units of production in the period in which they are incurred.This statement describes product costs,not period costs.