1.

The cost of raw materials will be expensed in a manufacturing companys income statement when:

A) the materials are used up in production.

B) the related products are sold.

C) the materials are purchased.

D) the related products are completed.

2.

Which of the following would NOT be an element of product cost?

A) Selling and administrative costs

B) Direct labor

C) Direct materials

D) Manufacturing overhead

3.

Which of the following cost formulas can be used to express an entirely (purely) variable cost(Assume a and b have non-zero values in the equations!)?

A) Y = bX

B) Y = a bX

C) Y = a

D) Y = a + bX