Product costs are:

A. expensed when incurred.

B. inventoried.

C. treated in the same manner as period costs.

D. treated in the same manner as advertising costs.

E. subtracted from cost of goods sold.

Which of the following is a product cost?

A. Upholstery fabric used to make reclining chairs.

B. Advertising.

C. The salary of the vice president-finance.

D. Rent on a factory.

E. Both "A" and "D."

Which of the following is not an example of a variable cost?

A. Straight-line depreciation on a machine expected to last 8 years

B. Piece-rate wages paid to manufacturing workers

C. Buttons on winter coats

D. Cocoa needed to make chocolate bars

E. Commissions paid to sales personnel

A manufacturer plans to increase production within the relevant range of activity. What

behavior can the company expect for each of the following?

Fixed Cost per Unit Variable Cost per Unit

A. No Change No Change

B. No Change Increase

C. Increase No Change

D. Decrease Increase

E. Decrease No Change

Modern Motors manufactures automobiles. Which of the following would not be classified as direct materials by the company?

A. Sheet metal used in the automobile's body.

B. Tires.

C. Interior leather.

D. CD player.

E. Wheel lubricant.

The accounting records of McCormick Company revealed the following costs:

Factory utilities	$ 34,000
Wages of assembly-line personnel	125,000
Customer entertainment	50,000
Indirect materials used	18,000
Depreciation on salespersons' cars	35,000
Production equipment rental costs	90,000

Costs that would be considered in the calculation of manufacturing overhead total:

A. $159,000.

B. $142,000.

C. $177,000.

D. $352,000.

E. some other amount.

Which of the following equations is used to calculate the cost of goods sold during the period?

A. Beginning finished goods + cost of goods manufactured + ending finished goods.

B. Beginning finished goods - ending finished goods.

C. Beginning finished goods + cost of goods manufactured.

D. Beginning finished goods + cost of goods manufactured - ending finished goods.

E. Beginning finished goods + ending finished goods - cost of goods manufactured.

Using the following data for April, calculate the cost of goods manufactured:

Direct Materials.. $39,000

Direct Labor $19,000

Manufacturing Overhead $27,000

Beginning work in process inventory. $14,000

Ending work in process inventory.. $12,000

The cost of goods manufactured was:

A. $74,000

B. $87,000

C. $83,000

D. $75,000

E. $111,000

15.Which of the following manufacturers would most likely use job-order costing?

A. Chemical manufacturers.

B. Microchip processors.

C. Custom-furniture manufacturers.

D. Gasoline refiners.

E. Soft-drink bottlers.

Variable costs per unit:

A. increases in direct proportion to changes in activity level.

B. decreases in direct proportion to changes in activity level.

C. remains unchanged as activity level changes.

D. A and B.

E. None of the above.

23. Fixed costs per unit:

A. change in direct proportion to changes in activity level.

B. change as activity varies.

C. remain unchanged as activity level changes.

D. A and B.

E. None of the above.

Hayward Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the most recently completed year appear below:

Estimates made at the beginning of the year:

Estimated machine-hours.. 19,000

Estimated variable manufacturing overhead $7.89 per machine-hour

Estimated total fixed manufacturing overhead.. $465,880

Actual machine-hours for the year. 20,200

The predetermined overhead rate for the recently completed year was closest to: A. $7.89 B. $30.95

C. $24.52 D. $32.41

E. none of the above.