Accounting 2302Exam 1 – Study GuideKnow how to calculate and apply the Hi/Low method and apply.Know the different types of costs are called and the concepts behind them. (Direct, Indirect, Prime, Fixed, Variable, sunk, period, etc.) You will need to pick these out of real life examples and apply them informulas.Know the COGS formula and how it is applied with both a merchandising and production firm.Know how to apply and plug in numbers (back into numbers) on each of the inventoriable cost formulas.Know how to calculate predetermined overhead rates. Understand the nature of Unit-level, Batch-level, Product-level and Facility-level activities and examples.Test taking tipsRead the question first on problems to see EXACTLY what it’s asking for and only that. It could be that the problem is only asking for only one of the three activities, only the direct materials used in WIP (which need to exclude indirect materials), etc.