Chapt. 2 Cost Concepts
1. Which of the following costs would not be included as part of manufacturing
Insurance on sales vehicles.
Depreciation of production equipment.
Lubricants for production equipment.
Direct labor overtime premium.
SAM HOUSTON STATE UNIVERSITY
COLLEGE OF BUSINESS ADMINISTRATION
Department of Accounting
Course Syllabus Spring 2011
Accounting 231 (Principles of Accounting)
1. The Tingey Company has 500 obsolete microcomputers that are carried in inventory at
a total cost of $720,000. If these microcomputers are upgraded at a total cost of $100,000,
they can be sold for a total of $160,000. As an alternative, the mi
1. Sartain Corporation is in the process of preparing its annual budget. The following
beginning and ending inventory levels are planned for the year.
Each unit of finished goods requires 2 grams of raw material. If the company plans to sell
1. A flexible budget:
classifies budget requests by activity and estimates the benefits arising from each
presents a statement of expectations for a period of time but does not present a firm
presents the plan for only one
1. Salt is an example of a product whose demand is price inelastic.
2. The absorption costing approach to cost-plus pricing provides assurance that the
company's required rate of return will be realized even if unit sales are less than
1. A favorable materials price variance coupled with an unfavorable material usage
variance would MOST likely result from:
problems with processing machines.
the purchase of low quality materials.
problems with labor efficiency.
changes in the p