Final Review

Final Review - EXTRA EXERCISES FINAL EXAM CHAPTER 2: 1....

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EXTRA EXERCISES FINAL EXAM CHAPTER 2: 1. Which of the following best describes the concept mentioned? a. A direct cost is not a traceable cost. b. All product costs are prime costs of a product. c. Product costs are all variable costs. d. An indirect cost is difficult to trace to a specific product. 2. Product costs appear on the balance sheet: a. only if goods are partially completed at the end of the period. b. only if goods are unsold at the end of a period. c. only if goods are partially completed or are unsold at the end of a period. d. only in merchandising firms. 3. During February, the cost of goods manufactured was $83,000. The beginning finished goods inventory was $14,000 and the ending finished goods inventory was $13,000. What was the cost of goods sold for the month? a. $83,000 b. $110,000 c. $82,000 d. $84,000 4. The following information is taken from the records of DW Company for last year: Direct materials. ............................................ $8,000 Direct labor. .................................................. $3,000 Manufacturing overhead. .............................. $11,000 Ending work in process inventory. ............... $5,000 Cost of goods manufactured. ........................ $19,000 The amount of beginning work in process inventory is: a. $24,000 b. $2,000 c. $22,000 d. $3,000 5. Which of these items is classified correctly based on normal assumptions about costs? Variable/Fixed Product/Period Direct/Indirect Product Cost a. Production supervisor salary Fixed Product Direct b. Sales commissions Variable Product Indirect c. Assembly person wage Variable Product Direct d. Depreciation on factory Fixed Product Direct e. Repairs on production machines Fixed Period Direct
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6. Fab Co. manufactures textiles. Fab's manufacturing costs last year included the following salaries and wages: Loom operators. ......................... $120,000 Factory foremen. ........................ $45,000 Machinery repairmen. ................ $30,000 What is the amount of direct labor included in this list? a. $195,000 b. $165,000 c. $150,000 d. $120,000 CHAPTER 5 7. Which of the following statements is true ? If volume decreases and: a. if all costs are fixed, the cost per unit should increase. b. if all costs are fixed, total cost should decrease. c. if all costs are variable, the cost per unit should decrease. d. if all costs are variable, total cost should increase. 8. As the level of activity increases, how will a mixed cost in total and per unit behave? In Total Per Unit A) Increase Decrease B) Increase Increase C) Increase No effect D) Decrease Increase E) Decrease No effect 9. Since Anytime Pizza is open 24 hours a day, its pizza oven is constantly on and is, therefore, always using natural gas. However, when there is no pizza in the oven, the oven automatically lowers its flame and reduces its natural gas usage by 70%. The cost of natural gas would best be described as a: a. fixed cost. b.
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Final Review - EXTRA EXERCISES FINAL EXAM CHAPTER 2: 1....

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