Accounting 2 Final

Advertising costs are considered product costs for external financial reports because they are incurred in order to promote specific products.

False (test 1)

Direct labor hours should never be used as a measure or activity in an activity based costing system

False [test one]

The first stage allocation in activity based costing is the process by which over head costs are assigned to activity cost pools

True! (test 1)

The cost of a completed job in a job order costing system typically consists of the actual direct materials cost of the job, the actual direct labor cost of the job and the actual manufacturing overhead cost of the job.

False [test 1]

If a company has a great deal of product diversity, activity based costing will generally yield more accurate product costs than traditional overhead application rates based on a direct labor or machine hours

TRUE [test 1]

Property taxes and insurance premiums paid on a factory building are examples of manufacturing overhead.

True (test 1)

If manufacturing overhead applied exceeds the actual manufacturing overhead costs of the period, then manufacturing overhead is over applied

True [TEST 1]

Under applied or over applied manufacturing overhead represents the difference between actual overhead costs and applied overhead is over applied.

True [test 1]

Committed fixed costs are fixed costs that are not controllable

false (Test 1)

Selling and administrative expenses are product costs under GAAP

false (test 1)

The process of assigning overhead cost to jobs is known as overhead application.

true (TEST 1)

The use of predetermined overhead rates in a job-order cost system makes it possible to estimate the total cost of a given job as soon as production is completed

true (Test 1)