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/ Homework Answers / Accounting / Multiple Choice Questions 1.The term "cost" means:   A. the price paid for a

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Multiple Choice Questions

1.The term "cost" means: 
 

A. the price paid for a raw material.

B. the wage paid to a worker.

C. the price charged by an entity for its services.

D. all of these.

2.Cost accounting is primarily concerned with: 
 

A. accumulation and determination of product or service cost.

B. income measurement and inventory valuation.

C. generally accepted accounting principles.

D. all of these.

3.Which of the following is more relevant to management accounting than to cost accounting? 
 

A. accumulation and determination of product or service cost.

B. income measurement and inventory valuation.

C. generally accepted accounting principles.

D. providing managers information for planning and control purposes.

4.The sequence of activities that add value to the organization are: 
 

A. the value processes.

B. the chain of production events.

C. the value chain.

D. the strategic cost initiatives.

5.Which of the following activities is not included in the organization's value chain? 
 

A. marketing.

B. finance.

C. customer service.

D. research and development.

6.For the partial value chain functions given below, which sequence is correct? 
 

A. design, production, marketing.

B. marketing, production, distribution.

C. research and development, production, distribution.

D. customer service, marketing, distribution.

7.An example of a product cost is: 
 

A. advertising expense for the product.

B. a portion of the president's travel expenses.

C. interest expense on a loan to finance inventory.

D. production line maintenance costs.

8.Which of the following costs would be classified as a period cost: 
 

A. production line maintenance costs.

B. advertising expense for the product.

C. plant electricity.

D. indirect labor.

9.Direct costs pertain to costs that: 
 

A. are traceable to a cost object.

B. are not traceable to a cost object.

C. are commonly incurred.

D. are variable costs.

10.The overhead component of product cost is: 
 

A. the sum of the actual overhead costs incurred in the manufacture of the product.

B. likely to be the same amount for every product made by the company.

C. an estimated amount based on labor hours, machine hours, or some other activity.

D. determined at the end of the year when actual costs and actual production are known.

13-1

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