Chap 2

9722 Words Mar 17th, 2015 39 Pages
1.
Selling costs can be either direct or indirect costs.
TRUE

2.
A direct cost is a cost that cannot be easily traced to the particular cost object under consideration.
FALSE

3.
Property taxes and insurance premiums paid on a factory building are examples of period costs.
FALSE

4.
Conversion cost equals product cost less direct labor cost.
FALSE

5.
Thread that is used in the production of mattresses is an indirect material that is therefore classified as manufacturing overhead.
TRUE

6.
Direct labor is a part of prime cost, but not conversion cost.
TRUE

7.
Conversion cost is the sum of direct labor cost and direct materials cost.
FALSE

8.
Direct material costs are generally fixed costs.
FALSE

9.
Product costs are recorded
…show more content…
The costs of prescription drugs administered by the nursing station to patients should be classified as:
A.
direct patient costs.

B. indirect patient costs.

C. overhead costs of the nursing station.

D. period costs of the hospital.

35.
All of the following costs would be found in a company's accounting records except:
A.
sunk cost.

B. opportunity cost.

C. indirect costs.

D. direct costs.

36.
The costs of the Accounting Department at Central Hospital would be considered by the Surgery Department to be:
A.
direct costs.

B. indirect costs.

C. incremental costs.

D. opportunity costs.

37.
Which of the following is classified as a direct labor cost?

A.
Option A

B.
Option B

C.
Option C

D.
Option D

38.
In a manufacturing company, direct labor costs combined with direct materials costs are known as:

A. period costs.

B. conversion costs.

C. prime costs.

D. opportunity costs.

39.
The property taxes on a factory building would be an example of:

A.
Option A

B.
Option B

C.
Option C

D.
Option D

40.
Which of the following would most likely be included as part of manufacturing overhead in the production of a wooden table?
A.
The amount paid to the individual who stains the table.

B.
The commission paid to the salesperson who sold the table.

C.
The cost of glue used in the table.

D.
The cost of the wood used in the table.

41.
Property taxes on a manufacturing facility are

More about Chap 2

Open Document