QUESTION 1

1. The cost of milk used to manufacture ice cream would most likely be classified as a(n):

		Variable cost
		Indirect cost
		Sunk cost
		Differential cost

QUESTION 2

1. Which of the following would not usually be considered a fixed cost?

		Insurance
		Executive salaries
		Plant depreciation
		Needles used in a hospital

QUESTION 3

1. The product costs of a software development company would NOT include:

		Computer lease
		Salary of the CEO
		Supplies used by programmers
		Computer programmers's salaries

QUESTION 4

1. Which of the following would NOT be included in manufacturing overhead?

		Indirect materials
		Factory utilities
		Factory fire insurance
		Direct labor

QUESTION 5

1. You currently work as a machinist for a factory. Your salary is $28,000 per year. You are thinking about quitting your job and going back to college. It will take you tow year to obtain your college degree. Tuition and other costs of the education will total $24,000. You also intend to keep your car by making $250 per month payments out of your savings. How much is the opportunity cost of going to college.

		$28,000
		$56,000
		$52,000
		$62.000

QUESTION 6

1. The scattergraph is a useful tool for:

		Analyzing abrupt changes in cost behavior
		Determining actual variable costs
		Determining the break-even point
		Working outside the relevant range

QUESTION 7

1. Which type of business organization allows the business to be a separate, distinct entity away from its owners?

		Partnership
		Proprietorship
		Corporation
		All of the above

QUESTION 8

1. Compared with preferred stock, common stock usually has a favorable prefence in terms of:

		Dividends
		Voting rights
		Liquidated assets
		Resale value

QUESTION 9

1. On January 1, 2013, Georgi Company was authorized to issue 10,000 share of $2 par value common stock and 5,000 shares of $5 preferred stock. Given this information, if Georgi Company issued 3,000 shares of common stock for $7 per share on January 10, 2013, the entry to record the issuance of the stock would include a

		Debit to Cash of $6,000
		Credit to Premium on Common Stock of $6,000
		Credit to Common Stock of $6,000
		Debit to Cash of $15,000

QUESTION 10

1. Moomey Corporation had 20,000 shares of $4 par value common stock outstanding on January 1, 2013. On January 10, 2013, the firm purchased 2,000 of its outstanding shares for $18 per share. On July 22, 2013, it reissued 1,000 shares at $22 per share. Given this information, the entry to record the reissuance of the stock on July 22 would include a credit to:

		Treasury stock of $4,000
		Common stock of $4,000
		Paid-In Capital of $18,000
		Gain on Sale of Treasury Stock of $4,000