coursehero_CHAPTERS 1 to 4 practice quiz

coursehero_CHAPTERS 1 to 4 practice quiz - 1. Which one of...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
1. Which one of the following costs would not be considered an indirect cost of serving a particular customer at a Pizza Hut franchise? Feedback: Learning Objective 1 - In this situation, the costs listed must be identified as either direct or indirect. A direct cost is a cost that can be easily and conveniently traced to the particular cost object under consideration (in this case, the cost of serving a customer at a Pizza Hut franchise). Indirect costs cannot be physically traced to the creation of products or can be traced only at great cost and inconvenience. (This question asks you to identify the cost that would not be considered an indirect cost; in other words, you must identify the direct cost that is listed to correctly answer the question.) The cost of the franchise manager (answer A), the cost of the tables and chairs (answer B) and the cost of the lighting and heating (answer D) would all be considered indirect costs. On the other hand, the cost of the dough used (C, the correct answer) could be easily and conveniently traced to the cost of serving a particular customer at a Pizza Hut franchise and would be a relatively significant in terms of the cost of the pizza. As such, the cost of the dough used would most likely be considered a direct cost. 2. The wages of materials handling personnel in a factory would usually be considered: Feedback: The wages of materials handling personnel cannot be physically traced to the creation of products or can be traced only at great cost and inconvenience. Labor costs that cannot be physically traced to the creation of products, or that can be traced only at great cost and inconvenience, are referred to as indirect labor and treated as part of manufacturing overhead. 3. The salary of the vice president of finance would be considered a(n): Feedback: Learning Objective 2 - Administrative costs include all executive, organizational, and clerical costs associated with the general management of an organization rather than with manufacturing, marketing, or selling. The salary of the vice president of finance is an executive cost associated with the general management of an organization and, as such, would be considered an administrative cost. 4. If the cost of goods manufactured is greater than the cost of goods sold, then:
Background image of page 1

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

View Full DocumentRight Arrow Icon
Feedback: The cost of goods sold for a manufacturing company is determined as follows: Cost of goods sold = Beginning finished goods inventory + Cost of goods manufactured - Ending finished goods inventory. If the cost of goods manufactured is greater than the cost of goods sold (as stated in the question), then the ending finished goods inventory (which is subtracted) must be greater than the beginning finished goods inventory (which is added); as such, the finished goods inventory must have increased during the period. 5.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 07/07/2011 for the course ACCT 202 at Clemson.

Page1 / 14

coursehero_CHAPTERS 1 to 4 practice quiz - 1. Which one of...

This preview shows document pages 1 - 3. Sign up to view the full document.

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