Chapter 2: an introduction to cost terms and purposes true/false
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| Answer: a Difficulty: 2 Objective: 7
100. Manufacturing costs include all EXCEPT a. costs incurred inside the factory. b. both direct and indirect costs. c. both variable and fixed costs. d. both inventoriable and period costs. Answer: d Difficulty: 2 Objective: 7 101. Inventoriable costs a. include administrative and marketing costs. b. are expensed in the accounting period sold. c. are particularly useful in management accounting. d. are also referred to as nonmanufacturing costs. Answer: b Difficulty: 2 Objective: 7 102. Inventoriable costs are expensed on the income statement a. when direct materials for the product are purchased. b. after the products are manufactured. c. when the products are sold. d. not at any particular time, it varies. Answer: c Difficulty: 2 Objective: 7 103. Costs that are initially recorded as assets and expensed when sold are referred to as a. period costs. b. inventoriable costs. c. variable costs. d. fixed costs. Answer: b Difficulty: 2 Objective: 7 104. For merchandising companies, inventoriable costs include a. the cost of the goods themselves. b. incoming freight costs. c. insurance costs for the goods. d. all of the above. Answer: d Difficulty: 2 Objective: 7 105. For manufacturing firms, inventoriable costs include a. plant supervisor salaries. b. research and development costs. c. costs of dealing with customers after the sale. d. distribution costs. Answer: a Difficulty: 2 Objective: 7 106. A plant manufactures several different products. The wages of the plant supervisor can be classified as a(n) a. direct cost. b. inventoriable cost. c. variable cost. d. period cost. Answer: b Difficulty: 2 Objective: 7 107. The cost of inventory reported on the balance sheet may include all of the following EXCEPT a. customer-service costs. b. wages of the plant supervisor. c. depreciation of the factory equipment. d. the cost of parts used in the manufacturing process. Answer: a Difficulty: 2 Objective: 7 108. For a computer manufacturer, period costs include the cost of a. the keyboard. b. labor used for assembly and packaging. c. distribution. d. assembly-line equipment. Answer: c Difficulty: 1 Objective: 7 109. Period costs a. include only fixed costs. b. seldom influence financial success or failure. c. include the cost of selling, delivering, and after-sales support for customers. d. should be treated as an indirect cost rather than as a direct manufacturing cost. Answer: c Difficulty: 2 Objective: 7 110. Period costs a. are treated as expenses in the period they are incurred. b. are directly traceable to products. c. include direct labor. d. are also referred to as manufacturing overhead costs. Answer: a Difficulty: 2 Objective: 7 111. Which of the following is NOT a period cost? a. Marketing costs b. General and administrative costs c. Research and development costs d. Manufacturing costs Answer: d Difficulty: 1 Objective: 7 112. Costs expensed on the income statement in the accounting period incurred are referred to as a. direct costs. b. indirect costs. c. period costs. d. inventoriable costs. Download 180.5 Kb. Share with your friends:
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