- Manufacturers consider selling and administrative costs to be
period costs,
prime costs,
conversion costs,
inventoriable costs.
period costs,
- An example of direct labor would be which of the following?
Wages of factory security
Salary of a production manager
Wages of assembly line personnel
Salary of the vice - president of operations
Wages of assembly line personnel
- A snow removal business would be classified as a
merchandising company,
service company,
simple company,
manufacturing company.
service company,
- The three basic components of inventoriable product costs are direct materials, direct labor, and
manufacturing overhead,
work in process,
cost of goods manufactured,
cost of goods sold.
manufacturing overhead,
- Which of the following is true?
Total fixed costs increase as production volume increases.
Total fixed costs decrease as production volume decreases.
Total variable costs stay constant as production volume increases.
Total variable costs increase as production volume increases.
Total variable costs increase as production volume increase;
- Direct materials for a company were $500,000: manufacturing overhead was $250,000; and direct labor was $770,000. Conversion costs would total?
$750,000.
$1,520,000.
$1,020,000.
$1,270,000.
$1,020,000.
770,000 + 250,000 = $1,020,000
- Which of the following types of information differs between alternatives and can affect the future?
Historical
Relevant
Irrelevant
Predictable
Relevant
- Plowin' Supply plans to make 15,000 tractors at its plant. Fixed costs are $600,000 and variable costs are $200 per tractor. What is the average cost per tractor?
$75
$200
$240
$40
$240
600,000 / 15,000 = 40 +200 = 240
- Which one of the following costs would be considered a direct cost of serving a particular customer at a McDonald's restaurant?
The cost of heating the restaurant
The depreciation on the restaurant building
The salary of the restaurant manager
The cost of the hamburger patty in the sandwich the customer ordered
The cost of the hamburger patty in the sandwich the customer ordered
- Which of the following is not an example of an indirect cost incurred in manufacturing automobiles?
Cost of the automobile engines
Plant supervisor salary
Plant utilities
Machinery depreciation in the factory
Cost of the automobile engines
