Accounting - Ch. 13 : Cost Accounting & Reporting

Which of the following items would NOT be reported on the Statement of Cost of Goods Manufactured?

Contribution margin

The three components of product costs are:

Direct Material, Direct Labor, Overhead

Which of the following is more relevant to management accounting than to cost accounting?

Providing managers information for planning and control purposes

Which of the following describes the correct sequence of flow of costs for a manufacturing firm?

Raw materials, work-in-process, finished goods, cost of goods sold

The use of activity-based costing information to support the decision-making process is known as:

activity-based management.

The product cost of a single unit of manufactured production is determined by:

adding total direct materials, direct labor, and manufacturing overhead for a production run and then dividing by the number of units produced.

Costs may be allocated to a product or activity for many purposes, but care must be exercised when using allocated costs because:

arbitrarily allocated costs may not behave in the way assumed in the allocation method.

Direct costs pertain to costs that:

are traceable to a cost object

A predetermined manufacturing overhead rate is used to:

assign indirect costs to the units produced.

An activity-based costing system involves identifying the activity that causes the incurrence of a cost; this activity is known as a:

cost driver

Total manufacturing costs for the month on the statement of costs of goods manufactured equals:

cost of raw material used + direct labor cost incurred + manufacturing overhead applied.

Which of the following activities is not included in the organization's value chain?

finance

If the number of units sold during March is exactly equal to number of units produced in March, then:

income determined with absorption costing will equal income determined with direct costing.

Direct costing may be used for:

internal reporting purposes

Which of the following is NOT an account that over/under applied overhead is transferred to at the end of an accounting period?

manufacturing overhead has not been accurately applied

A credit balance in the manufacturing overhead account at the end of the period indicates that:

manufacturing overhead is overapplied.

The risk of cost distortion is minimized with activity-based costing by applying overhead using:

multiple cost driver rates.

An example of a direct cost in the production of a computer is:

production labor costs.

A cost that has a direct relationship with products being manufactured is:

production labor wages.

The three sections of a statement of cost of goods manufactured include:

raw material, direct labor, manufacturing overhead.

Strategic cost management initiatives that would occur in an organization's value chain functions begins with __________ and concludes with __________.

research and development, customer service

Product costs are inventoried and treated as assets until:

the period in which the products they relate to are sold.

The term "cost" means:

the price paid for a raw material. the wage paid to a worker. the price charged by an entity for its services.

The value chain of an organization refers to:

the sequence of functions and related activities that add value for the customer

An example of a product cost is:

wages of the manufacturing assembly line staff.