Coursehero - Coursehero > Florida > FAU > ACG 3341...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Coursehero >> Florida >> FAU >> ACG 3341 Course Hero has millions of student submitted documents similar to the one below including study guides, homework solutions, papers, exam answer keys and textbook solutions. 2: CHAPTER AN INTRODUCTION TO COST TERMS AND PURPOSES TRUE/FALSE 1. Products, services, departments, and customers may be cost objects. Answer: 2. True Difficulty: 1 Objective: 1 Costs are accounted for in two basic stages: assignment followed by accumulation. Answer: False Difficulty: 1 Objective: 1 Costs are accounted for in two basic stages: accumulation followed by assignment. 3. Actual costs and budgeted costs are two different terms referring to the same thing. Answer: False Difficulty: 1 Objective: 1 Budgeted costs are what is planned before the beginning of the accounting period, while actual costs are those costs compiled at the end of the accounting period. 4. The same cost may be direct for one cost object and indirect for another cost object. Answer: True Difficulty: 3 Objective: 2 5. Assigning direct costs poses more problems than assigning indirect costs. Answer: False Difficulty: 2 Objective: 2 Tracing direct costs is quite straightforward, whereas assigning indirect costs to a number of different cost objects can be very challenging. 6. Improvements in information-gathering technologies are making it possible to trace more costs as direct. Answer: True Difficulty: 2 Objective: 2 7. Misallocated indirect costs may lead to promoting products that are not profitable. Answer: True Difficulty: 2 Objective: 2 8. The materiality of the cost is a factor in classifying the cost as a direct or indirect cost. Answer: True Difficulty: 2 Objective: 2 9. The cost of a customized machine only used in the production of a single product would be classified as a direct cost. Answer: True Difficulty: 1 Objective: 2 10. Some fixed costs may be classified as direct manufacturing costs. Answer: True Difficulty: 1 Objective: 2 Chapter 2 Page 1 11. Fixed costs have no cost driver in the short run, but may have a cost driver in the long run. Answer: True Difficulty: 2 Objective: 3 12. Costs that are difficult to change over the short run are always variable over the long run. Answer: True Difficulty: 2 Objective: 3 13. Knowing whether a cost is a period or a product cost helps to estimate total costs at a new level of activity. Answer: False Difficulty: 2 Objective: 3 Knowing whether a cost is a variable or a fixed cost helps to estimate total costs at a new level of activity. 14. A decision maker cannot adjust capacity over the short run. Answer: True Difficulty: 1 Objective: 3 15. Fixed costs vary with the level of production or sales volume. Answer: False Difficulty: 1 Objective: Variable costs vary with the level of production or sales volume. 3 16. Currently, most administrative personnel costs would be classified as fixed costs.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 21

Coursehero - Coursehero > Florida > FAU > ACG 3341...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online