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ACG 203 Ch.1 Smartbook (1).
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ACG 203 Ch.1 SmartbookAny item for which cost data is desired is called a(n) - ANS-cost object
Fantastic Furniture makes custom order couches. The material used to make a couch is a(n)
______ cost of the customer placing the order. - ANS-direct
A cost that can be easily and conveniently traced to a specific cost object is a(n) _______ cost
of that cost object, whereas costs that cannot be easily and conveniently traced to that specific
cost object are _______ costs. - ANS-direct; indirect
A type of indirect cost incurred to benefit more than one cost object is a(n) ______ cost. -
ANS-common
T/F: A cost may be direct or indirect, depending on the cost object. - ANS-True
Cost objects include ______. - ANS--customers
-organizational subunits
-anything for which cost data is desired
Manufacturing costs include ______. - ANS--manufacturing overhead (MOH)
-direct labor
-direct materials
Costs that can be easily and conveniently traced to a specific product are called ______ costs. -
ANS-direct
T/F: The finished product of one company can become raw materials for another company. -
ANS-True
A manufacturing cost that cannot be easily traced to a specific cost object is a(n) _______ cost.
- ANS-indirect
A laptop computer manufacturer would consider the computer's processor chip to be a(n)
______ cost. - ANS-direct material
Costs that are shared by multiple cost objects in a company are known as ______ costs. -
ANS-common
Direct labor is also called _________ labor. - ANS-touch
Which of the following statements are true?
, -An individual cost is either direct or indirect, regardless of the cost object.
-A direct cost is sometimes referred to as a common cost.
-A direct cost can be easily and conveniently traced to a specific cost object.
-A regional sales manager's salary is a direct cost of the regional office in which the sales
manager works. - ANS--A direct cost can be easily and conveniently traced to a specific cost
object.
-A regional sales manager's salary is a direct cost of the regional office in which the sales
manager works.
Prime costs include ______.
-direct materials
-direct labor
-manufacturing overhead
-selling and administrative expenses - ANS--direct materials
-direct labor
Direct materials and direct labor are both ______ costs. - ANS-manufacturing
Indirect materials and indirect labor are classified as ______. - ANS-manufacturing overhead
The materials that go into the final product are called ______ materials. - ANS-raw
A dress manufacturer would consider the cost of relatively inexpensive items like thread to be
part of ______.
-manufacturing overhead
-indirect materials
-administrative costs
-direct materials - ANS--manufacturing overhead
-indirect materials
Materials that become an important component of the finished product whose cost can be easily
and conveniently traced to the finished product are _____ materials. - ANS-direct
Salaries of factory supervisors and factory maintenance personnel are examples of ______
labor costs. - ANS-indirect
Labor costs that can be easily and conveniently traced to specific products are ______ costs. -
ANS-direct labor costs
Direct labor and overhead costs incurred to change raw materials into finished products are
known as _________ costs. - ANS-conversion
The sum of direct materials and direct labor is called _______ cost. - ANS-prime
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