Exam 18: Managerial Accounting Concepts and Principles

Direct costs are incurred for the benefit of more than one cost object.

Cycle time is calculated by process time plus inspection time plus move time plus __________________.

One of the main differences between the calculation of cost of goods sold for a merchandiser and that of a manufacturer is that the calculation includes cost of goods purchased for the merchandiser, but the manufacturer replaces that with __________________________.

An opportunity cost is:

Which of the following items represents a difference between financial and managerial accounting?

Labor costs that are clearly associated with specific units or batches of product because the labor is used to convert raw materials into finished products are called:

Although direct labor and raw materials costs are treated as manufacturing costs and therefore make up part of the finished goods inventory cost, factory overhead is charged to expense as it is incurred because it is a period cost.

Which of the following statements is True regarding product and period costs?

Whether a cost is controllable or not controllable by an employee depends on the employee's level of responsibility.

Selling and administrative expenses are normally product costs.

When the attitude of continuous improvement exists throughout an organization, every manager and employee seeks to continuously experiment with new and improved business practices.

A manufacturer's cost of goods manufactured is the sum of direct materials, direct labor, and factory overhead costs incurred in producing products.

Using the information below, compute the manufacturing cycle time:

For a manufacturing firm, cycle time may be computed as process time + inspection time + move time - wait time.

____________________ inventory consists of completed products ready for sale by a manufacturer.

The salary paid to the supervisor of an assembly line would normally be classified as:

The three major cost components of a manufactured product are:

A company's prime costs total $4,500,000 and its conversion costs total $5,500,000. If direct materials are $2,000,000, calculate the overhead costs:

Expenditures that flow directly to the current income statement and are not reported as assets are ___________________ costs.

Flexibility of practice when applied to managerial accounting means that