Chapter 14

which of the following are fixed costs relative to the number of units produced and sold

- building rent - straight-line depreciation - manager's salary

a schedule of cost of goods manufactured has the following main sections

- computation of cost of goods manufactured - overhead - direct labor - direct materials

which of the following are product costs for a manufacturer

- depreciation on the factory equipment - direct materials

the purpose of managerial accounting is to provide useful information to aid in:

- determining costs of products and services - comparing actual to planned results

the following items would be included in the overhead section of the schedule of cost of goods manufactured

- factory utilities - factory supplies used - factory insurance

each of the following are examples of factory overhead

- indirect materials - indirect labor

which of the following are the variable costs relative to number of units produced and sold

- materials used in production - commissions based on sales

what types of information does managerial accounting provide

- non-financial - financial - information for internal decision makers

Consider a company that manufactures picture frames. Which of the following costs would be considered direct costs?

- oak wood used for frame - glass used in the frame - wages of assembly line worker

materials activity

- raw materials beginning inventory - raw materials purchases

which of the following are period costs for a manufacturer

- rent on the office building - sales commission - wages for administrative staff

which of the following characteristics describe managerial accounting

- used to make planning and control decisions - many projections and estimates

costs that are traceable to a single cost object

direct costs

those who work directly on the product to convert raw materials into a finished product are known as

direct labor

what are prime costs

direct material + direct labor

costs which are tangible components of the finished product are called

direct materials

conversion costs consist of

factory overhead and direct labor

structured and controlled by GAAP

financial accounting

period costs

include selling expenses and general office personnel, advertising expenses, and depreciation of office equipment

the purpose of the information is to assist managers in making planning and control decisions

managerial accounting

managerial accounting is different from financial accounting in that

managerial accounting is used in planning and control decisions and financial accounting is used in investment and credit decisions

the main purpose of managerial accounting is

providing useful information to internal managers

the cost of handlebars on a bicycle are considered

variable and direct

sales commissions computed as a percent of sales revenue are

variable costs

Consider a company that manufactures automobiles. Which of the following costs would be considered a direct cost?

wages of assembly line workers