Solved

Match the Appropriate Definition with the Following Terms

Question 201

Matching

Match the appropriate definition with the following terms:

Premises:

Responses:

Joint cost

Costs incurred to produce or purchase two or more products at the same time.

Investment center

Costs that are incurred for the joint benefit of more than one department and cannot be readily traced to only one department.

Cost center

A department that generates revenues and incurs costs.

Profit center

A department or unit that incurs costs without directly generating revenues.

Indirect expenses

A department or unit that generates revenues and incurs costs, in which the manager is also responsible for investments made in operating assets.

Direct expenses

Costs readily traced to a specific department because they are incurred for the sole benefit of that department.

Controllable costs

Costs for which a manager has the power to determine or at least significantly affect.

Premises:

Joint cost

Investment center

Cost center

Profit center

Indirect expenses

Direct expenses

Controllable costs

Responses:

Costs incurred to produce or purchase two or more products at the same time.

Costs that are incurred for the joint benefit of more than one department and cannot be readily traced to only one department.

A department that generates revenues and incurs costs.

A department or unit that incurs costs without directly generating revenues.

A department or unit that generates revenues and incurs costs, in which the manager is also responsible for investments made in operating assets.

Costs readily traced to a specific department because they are incurred for the sole benefit of that department.

Costs for which a manager has the power to determine or at least significantly affect.

Correct Answer:

Premises:

Responses:

Joint cost

Investment center

Cost center

Profit center

Indirect expenses

Direct expenses

Controllable costs