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test bank for cost accounting a managerial emphasis canadian 7th edition by horngren

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Accounting

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Alexandria State University

test bank for cost accounting a managerial emphasis canadian 7th edition by horngren test bank for cost accounting a managerial emphasis canadian 7th edition by horngren test bank for cost accounting a managerial emphasis canadian 7th edition by horngren test bank for cost accounting a manageria...

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1 © 2016 Pearson Canada Inc. Cost Accounting, Cdn. Ed., 7e (Horngren) Chapter 2 An Introduction to Cost Terms and Purposes 2.1 Identify and distinguish between two manufacturing cost classification systems: direct and indirect, prime and conversion. 1) "Cost" is defined by accou ntants as a resource sacrificed or foregone to achieve a specific objective. Answer: TRUE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 2) Costs of Sales is another way of phrasing Cost of Goods Sold. Answer: TRUE Diff: 1 Type: TF Skill: R emember Objective: LO 2 -1 3) An actual cost is a predicted cost. Answer: FALSE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 4) Nearly all accounting systems accumulate forecasted costs. Answer: FALSE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 5) A cost object is anything for which a separate measurement of costs is desired. Answer: TRUE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 6) Indirect costs cannot be economically traced directly to the cost objective. Answe r: TRUE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 7) Delivery charges are typically considered to be an indirect cost because it cannot be traced to each customer. Answer: FALSE Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 Test Bank for Cost Accounting A Managerial Emphasis Canadian 7th Edition by Horngren IBSN 9780133929157
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Full all chapters instant download please go to Solutions Manual, Test Bank site: downloadlink.org 2 © 2016 Pearson Canada Inc. 8) A cost is classified as a direct or indirect cost based on the applicable cost object. Answer: TRUE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 9) Cost tracing assigns indirect costs to the chosen cost object. Answer: FALSE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 10) Factors affecting direct/indirect cost classifications are the materiality of the cost in question, the information -gathering technology used, and the operations. Answer: TRUE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 11) Rent for the building that contains the manufacturing and engineering departments can all be charged as manufacturing overhead costs. Answer: FALSE Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 12) The plant supervis or's salary is a direct labour cost. Answer: FALSE Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 13) Conversion costs include all direct manufacturing costs. Answer: FALSE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 14) Prime co sts consist of direct and indirect manufacturing labour. Answer: FALSE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -1 3 © 2016 Pearson Canada Inc. 15) Conversion costs are all manufacturing costs other than direct materials. Answer: TRUE Diff: 1 Type: TF Skill: Rememb er Objective: LO 2 -1 16) Products, services, departments, and customers may be cost objects. Answer: TRUE Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 17) Costs are accounted for in two basic stages: assignment followed by accumulation. Answer: FALSE Explanation: Costs are accounted for in two basic stages: accumulation followed by assignment. Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 18) A cost object is always either a product or a service. Answer: FALSE Explanation: A cost object could be anything management wishes to determine the cost of, for example, a department. Diff: 2 Type: TF Skill: Remember Objective: LO 2 -1 19) Assigning direct costs poses more problems than assigning indirect costs. Answer: FALSE Explanation: Tracing direct costs is quite straightforward, whereas assigning indirect costs to a number of different cost objects can be very challenging. Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 20) A department could be considered a c ost object. Answer: TRUE Diff: 2 Type: TF Skill: Understand Objective: LO 2 -1 4 © 2016 Pearson Canada Inc. 21) Cost assignment is a term that refers solely to allocating indirect costs among diverse cost objects. Answer: FALSE Explanation: C ost assignment is a general term that encompasses both (1) tracing direct costs to a distinct cost object and (2) allocating indirect costs among diverse cost objects. Diff: 2 Type: TF Skill: Remember Objective: LO 2 -1 22) Materiality refers to the significance of the cost in questi on. Answer: TRUE Diff: 1 Type: TF Skill: Remember Objective: LO 2 -5 23) Anything for which a separate measurement of costs is desired is known as A) a cost item. B) a cost object. C) a fixed cost item. D) a variable cost object. E) a cost driver. Answer: B Diff: 1 Type: MC Skill: Remember Objective: LO 2 -1 24) Which of the following is a cost object? A) direct materials B) customers C) conversion costs D) cost assignments E) indirect labour Answer: B Diff: 2 Type: MC Skill: Understand Obje ctive: LO 2 -1 25) Which of the following is an indirect production cost? A) materials placed into production B) calibrating factory equipment C) labour placed into production D) cost of shipping a product to the customer E) advertising Answer: B Diff: 2 Type: MC Skill: Understand Objective: LO 2 -1

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