1) Retsina, Inc. uses an actual costing system. The following information is available: Raw materials, beginning $10,000 Work-in-process, beginning 30,000 Finished goods, beginning 13,000 Raw materials purchased 8,000 Direct labor 15,000 Depreciation-factory 2,000 Depreciation-office 1,000 Selling costs 4,000 Raw materials, ending 9,000 Finished goods, ending 14,000 Cost of goods sold 40,000 The cost of goods manufactured is: a. $39,000 b. $40,000 c. $41,000 d. $51,000

2) Merchandising financial statements differ from manufacturing statements in that : a. merchandising firms generally have three inventory accounts on the balance sheet whereas manufacturing firms have one. b. Manufacturing firms must calculate the cost of goods manufactured prior to computing the cost of goods sold. c. Merchandising firms have no product costs but manufacturing firms do. d. There are really no differences between the financial statements.

3)Choose the correct statement a. Fixed costs are constant per unit. b. Variable costs are constant per unit. c. Fixed costs are variable in total d. Variable costs are variable per unit. e. None of the above is a correct statement.

4).For income statement purposes depreciation is a variable expenses if the depreciation used for book purposes is: a. units of production b. straight-line c. sum-of-years-digits d. declining balance

5) Which of the following statements is true? a. Direct costs are always controllable. b. Indirect costs are controllable at some level of the organization c. All variable costs are controllable at some level of the organization d. All variable costs are differential whereas some fixed costs are not differential costs. e. An opportunity cost is the difference in benefit between one alternative that is accepted and a second alternative that has been rejected.