acct 2010 exam 1 clemson

Which of the following are differences between the traditional and contribution format to income statements?

Compared to traditional statements, contribution format statements provide management with a tool to make decision making easier. Traditional income statements focus on cost classifications. Contribution format statements focus on cost behavior.

Which of the following statements are true?

Period costs are expensed when incurred. Period costs do not flow through the inventory accounts.

Cost objects include ______.

anything for which cost data is desired organizational subunits customers

Any item for which cost data is desired is called a(n)

cost object

Materials that become an important component of the finished product whose cost can be easily and conveniently traced to the finished product are_______ materials

direct

Administrative costs include:

executive compensation and public relations costs

Indirect labor costs include:

factory security guard wages assembly-line supervisor salary

Within the relevant range of activity, ______ costs remain constant in total. Multiple choice question.

fixed

Product costs flow through the inventory accounts until the goods are sold, at which time they are matched against sales on the:

income statement

Manufacturing overhead costs include ______.

indirect materials, factory supervisors' salaries, and factory depreciation

Product costs are also called _____costs

manufacturing

The accrual concept that costs incurred to generate revenue are expensed in the same period the revenue is recognized is known as the_____ principle

matching

Inventoriable costs is another term for___ Costs

product

Direct materials, direct labor, and manufacturing overhead are all ______ costs.

prouduct

The materials that go into the final product are called ____materials.

raw

Cost behavior:

refers to how a cost will change as activity level changes categorizes costs as fixed, mixed and variable

The level of activity within which variable and fixed cost assumptions are valid is known as the

relevant range

Direct labor is also called______ labor.

touch

Period costs are expensed in the same period in which they are incurred. Sales commissions are period costs.

true

Mixed costs are also commonly known as semi

variable costs