1- Product costs under variable costing would consist of:

		direct materials, direct labor, and variable overhead
		Period Costs
		direct materials, direct labor, and selling costs.
		direct materials, direct labor, variable overhead and fixed overhead

2- TRUE or FALSE If your Flexible Budget had a expense of $10,000 and the actual expense cost $11,000 based on financial records. This would be an example of a Unfavorable Variance.

3- In step 3 of the ABC process on your spreadsheet calculate the rate to be assigned each activity by:

		By subtrating the allocated cost assigned to the cost pool by the estimated activity assigned.
		By multiplying the allocated cost assigned to the cost pool by the estimated activity assigned.
		By dividing the allocated cost assigned to the cost pool by the estimated activity assigned.
		By dividing the estimated activity assigned by the number of cost pools.

4-

Which of the following businesses is most likely to use process costing?

		Chemical Plant
		Architectural Firm
		Manufacturer of fine furniture
		CPA firm

5- TRUE or FALSE A person who analyzes Flexible Budgets by looking into line item variances could be described as practicing "Management by Exception".