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Introduction to Managerial Accounting
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Introduction to Managerial Accounting
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Solution Manual for Introduction to Managerial Accounting,7th Canadian Edition 2024, by Peter C. Brewer, Ray H.
Garrison, Verified Chapters 1 - 14, Complete Newest Version
Which type of cost changes in total, in direct proportion to chages in activity level? -
ANSWER: Variable
In an automobile manufacturing plant, the assembly line workers are considered to
be _____ _____. - ANSWER: Direct labor
Fixed costs: - ANSWER: - should not be expressed on a per unit basis when making
decisions
- generally include rent and supervisor salaries
- remain constant in total regardless of changes in activity
A laptop computer manufacturer would consider the computer's processor chip to
be a(n) _____ cost. - ANSWER: Direct material
Salaries of factory supervisors and factory maintenance personnel are examples of
_____ labor costs. - ANSWER: Indirect
Within the relevant range of activity, variable costs: - ANSWER: - vary in total
- remain constant per unit
Factory materials, such as cleaning supplies, that are not components of finished
products are classified as: - ANSWER: Manufacturing overhead
Which of the following statements are true? - ANSWER: - The relevant range of
activity is approximated by a straight line.
- Within the relevant range of activity, fixed costs remain constant in total.
Fixed costs remain constant in _____ over the _____ range of activity. - ANSWER:
Total
Relevant
A cost that can be easily and convenienlty 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. - ANSWER: Direct
Indirect
Costs that can be easily and conveniently traced to a specific product are called
_____ costs. - ANSWER: Direct
Contribution Margin is: - ANSWER: Sales revenue minus variable costs
, The equation for a straight-line can be used to express the relationship between
mixed costs and the level of activity. - ANSWER: Ture
Management cannot use account analysis when trying to estimate the components
of a mixed cost. - ANSWER: False
Mixed costs contain both fixed and variable cost elements. - ANSWER: True
Mixed costs are also commonly known as step variable costs. - ANSWER: False
Costs that are shared by multiple cost objects in a company are known as _____
costs. - ANSWER: Common
A change in revenues between two alternatives is known as _____ revenue or
incremental revenue. - ANSWER: Differential
Cost Behavior: - ANSWER: - refers to how a cost will change as activity level changes
- categorizes costs as fixed, mixed and variable
When mixed costs are represented by a straight-line, the steeper the slope, the
higher the variable cost per unit. - ANSWER: True
The equation for straight-line makes it easy to calculate the total mixed cost for any
activity level outside the relevant range. - ANSWER: False
A mixed cost has a minimum cost of having a service available and ready for use. -
ANSWER: True
The fixed portion of a mixed cost represents the cost incurred for the actual
consumption of a service. - ANSWER: False
Within the relevant range of activity, _____ cost remain constant in total. - ANSWER:
Fixed
Periods costs are included as part of the cost of goods. - ANSWER: False
The wages of assembly-line workers are period costs. - ANSWER: False
Sales commissions are period costs. - ANSWER: True
Period costs are expensed in the same period in which they are incurred. - ANSWER:
True
The revenue obtained from selling one additional unit of product is called _____
revenue. - ANSWER: Marginal
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