Q.1
Variable costs ..-
  • Increase in total with the increase in production
  • Increase per unit with the increase in production
  • Include prime costs and all factory overheads
  • Include all manufacturing, administrative and selling and distribution costs
Q.2
The formula for calculating the cost of goods sold for manufacturing company is ..-
  • Finished goods at beginning of the year + cost of finished goods produced - finished goods at end of the year
  • Total manufacturing costs + work-in-progress at beginning of the year - work-in-progress at end of the year
  • Finished goods at beginning of the year + cost of sales - finished goods at end of the year
  • Finished goods at beginning of the year - cost of finished goods produced - finished goods at end of the year
Q.3
Depreciation on office furniture is considered to be a (an).. -
  • Administrative costs
  • Selling and distribution costs
  • Overhead costs
  • Negative asset
Q.4
The subtotal, "Cost of goods manufactured" appears on..
  • a merchandising companies' Statements of Comprehensive Income
  • both manufacturing and a merchandising companies' Statements of Comprehensive Income
  • neither manufacturing nor a merchandising companies' Statements of Comprehensive Income
  • a manufacturing companies' Statements of Comprehensive Income
Q.5
Factory insurance is considered to be a (an).. -
  • Overhead costs
  • Prime costs
  • Administrative costs
  • Operating income
Q.6
The product cost that is most difficult to associate with a product is..
  • direct materials.
  • direct labour.
  • manufacturing overhead.
  • advertising.
Q.7
A manufacturing process requires small amounts of glue. The glue used in the production process is classified as a(n)..
  • period cost.
  • indirect material.
  • direct material.
  • miscellaneous expense.
Q.8
Which one of the following costs would not be inventoriable?
  • Period costs
  • Factory insurance costs
  • Indirect materials
  • Indirect labour costs
Q.9
Manufacturing costs include..
  • direct materials and direct labour only.
  • direct materials and manufacturing overhead only.
  • direct labour and manufacturing overhead only.
  • direct materials, direct labour, and manufacturing overhead.
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