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Accounting Exam- Chapter 1
Terms in this set (50)
Rotonga Manufacturing Company leases a vehicle to deliver its finished products to customers. Which of the following terms correctly describes the monthly lease payments made on the delivery vehicle?
Direct Cost - No; Fixed Cost - Yes
The costs of direct materials are classified as:
conversion cost- NO, manufacturing & prime cost- YES
Which of the following would most likely NOT be included as manufacturing overhead in a furniture factory?
The amount paid to the individual who stains a chair.
The cost of lubricants used to grease a production machine in a manufacturing company is an example of a(n)
indirect material cost.
Which of the following is NOT a period cost?
Depreciation of factory maintenance equipment.
The cost of electricity for running production equipment is classified as:
conversion cost- YES, period cost- NO
Wages paid to the supervisor of the warehouse where raw materials and parts are temporarily stored before being used in production is considered an example of:
direct labor- NO, period cost- NO
Depreciation on a personal computer used in the marketing department of a manufacturing company would be classified as:
a period cost that is fixed with respect to the company's output.
A factory supervisor's wages are classified as:
Indirect labor - Yes; Fixed manufacturing overhead - Yes
As the level of activity increases, how will a mixed cost in total and per unit behave?
in total- increase, per unit- decrease
For the past 8 months, Jinan Corporation has experienced a steady increase in its cost per unit even though total costs have remained stable. This cost per unit increase may be due to _____________ costs if the level of activity at Jinan is _______________.
Which of the following costs could contain both variable and fixed cost elements with respect to the total output of the company?
When the level of activity decreases within the relevant range, the fixed cost per unit will:
can be easily traced to a particular cost object.
Which of the following is an example of a period cost in a company that makes clothing?
Advertising cost for a new line of clothing.
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