1. (TCO A) Direct material cost is a part of: (Points : 6) Conversion Cost YES.... Prime Cost NO
Conversion Cost NO.... Prime Cost YES
Conversion Cost YES.... Prime Cost YES
Conversion Cost NO.... Prime Cost NO
2. (TCO A) The costs of staffing and operating the accounting department at Central Hospital would be considered by the Department of Surgery to be: (Points : 6) direct costs.
None of the above.
3. (TCO A) Property taxes on a company's factory building would be classified as a(n): (Points : 6) sunk cost
4. (TCO A) Within the relevant range, variable costs can be expected to: (Points : 6) vary in total in direct proportion to changes in the activity level. remain constant in total as the activity level changes. increase on a per unit basis as the activity level increases. increase on a per unit basis as the activity level decreases. none of these.
5. (TCO F) Emco Company uses direct labor cost as a basis for computing its predetermined overhead rate. In computing the predetermined overhead rate for last year, the company included in direct labor cost a portion of indirect labor. The effect of this misclassification will be to: (Points : 6) understate the predetermined overhead rate
overstate the predetermined overhead rate
have no effect on the predetermined overhead rate cannot be determined from the information given
6. (TCO F) Under a job-order costing system, the product being manufactured: (Points : 6) is homogeneous.
passes from one manufacturing department to the next before being completed. can be custom manufactured.
has a unit cost that is easy to calculate by dividing total production costs by the units produced.
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