ACCT

direct labor

also called touch labor

Differential cost

always relevant

direct labor

is common to both prime cost and conversion cost.

Product costs

best describe the wages of a sheet metal worker in a fabrication plant.

common cost

A ___________ is a cost that is incurred to support a number of cost objects but cannot be traced to them individually.

indirect cost

Adventure Holiday sells thousands of tour packages each month through its various branches. A branch manager's salary would be a(n) _________ of selling a tour package.

direct materials

Materials that become an integral part of the finished product and whose costs can be conveniently traced to the finished product are called

matching principle

The ________ requires that the costs incurred to generate a particular revenue should be recognized as expenses in the same period that the revenue is recognized.

A fixed cost is a cost which

remains constant in total with changes in the level of activity

If a firm increases its activity level,

some costs will change, other costs will remain the same

direct cost

Adventure Holiday sells thousands of tour packages each month through its various branches. A branch manager's salary would be a(n) _________ of the branch.

manufacturing overhead costs

Items such as indirect materials, indirect labor, maintenance and repairs on production equipment, depreciation, and insurance on manufacturing facilities are included in ________.

non-manufacturing costs

Property taxes associated with a company's administrative facility are considered ________.

Which observation is true of period costs

They are expensed in the period in which they are incurred.