Accounting Test with Multiple Choice Questions
BA 213 - Test#1 Review Instructor: Usha Ramanujam Dear Students,
I have indicated answers to the test review questions in BOLD. You can highlight the entire review and remove the bold feature before you start working on these questions and then verify the answers. Also, detailed solutions are given for q.38 and q.40 /Usha
1. Thread used in the production of mattresses, an indirect material, is classified as manufacturing overhead. TRUE/ False
2. Prime cost and conversion cost share what common element of total cost? A) Direct materials. B) Direct labor. C) Variable overhead. D) Fixed overhead.
3. Wages paid to a timekeeper in a factory are a:
Prime cost
Conversion cost
A)
Yes
No
B)
Yes
Yes
C)
No
No
D)
No
Yes
4. The nursing station on the fourth floor of Central Hospital is responsible for the care of patients who have undergone orthopedic surgery. The costs of drugs administered by the nursing station to patients would be classified as: A) direct costs of the patients. B) indirect costs of the patients. C) overhead costs of the nursing station. D) period costs of the hospital.
Number of Units Produced
Unit Cost
Total Cost
Cost A
1
?
$10
10
?
$100
100
?
$1,000
1,000
?
$10,000
Cost B
1
$5,000
?
10
$500
?
100
$50
?
1,000
$5
?
5. Which of the above best describes the behavior of Costs A and B? A) Cost A is fixed, Cost B is variable. B) Cost A is variable, Cost B is fixed. C) Both Cost A and Cost B are variable. D) Both Cost A and Cost B are fixed.
6. John Johnson decided to leave his former job where he earned $12 per hour to go to a new job where he will earn $13 per hour. In the decision process, the former wage of $12 per hour would be classified as a(n): A) sunk cost. B) direct cost. C) fixed cost. D) opportunity cost.
7. The
I have indicated answers to the test review questions in BOLD. You can highlight the entire review and remove the bold feature before you start working on these questions and then verify the answers. Also, detailed solutions are given for q.38 and q.40 /Usha
1. Thread used in the production of mattresses, an indirect material, is classified as manufacturing overhead. TRUE/ False
2. Prime cost and conversion cost share what common element of total cost? A) Direct materials. B) Direct labor. C) Variable overhead. D) Fixed overhead.
3. Wages paid to a timekeeper in a factory are a:
Prime cost
Conversion cost
A)
Yes
No
B)
Yes
Yes
C)
No
No
D)
No
Yes
4. The nursing station on the fourth floor of Central Hospital is responsible for the care of patients who have undergone orthopedic surgery. The costs of drugs administered by the nursing station to patients would be classified as: A) direct costs of the patients. B) indirect costs of the patients. C) overhead costs of the nursing station. D) period costs of the hospital.
Number of Units Produced
Unit Cost
Total Cost
Cost A
1
?
$10
10
?
$100
100
?
$1,000
1,000
?
$10,000
Cost B
1
$5,000
?
10
$500
?
100
$50
?
1,000
$5
?
5. Which of the above best describes the behavior of Costs A and B? A) Cost A is fixed, Cost B is variable. B) Cost A is variable, Cost B is fixed. C) Both Cost A and Cost B are variable. D) Both Cost A and Cost B are fixed.
6. John Johnson decided to leave his former job where he earned $12 per hour to go to a new job where he will earn $13 per hour. In the decision process, the former wage of $12 per hour would be classified as a(n): A) sunk cost. B) direct cost. C) fixed cost. D) opportunity cost.
7. The