Some costs that possibly could be traced directly to cost objects are nonetheless classified as indirect costs because:

Such practice results in a more accurate accumalated cost for the object.

Generally accepted accounting principles require some costs to be treated as indirect.

Such costs cannot be traced to objects in a cost-effective manner.

Most contracts call for the inclusion of at least some indirect materials costs.

Which of the following is a false statement?

A cost driver is something that managers wish to know the cost of.

All of the above are true.

Generall the best driver is the one with the strongest cause and effect relationship.

The availability of information is an influence on cost driver selection.

Hablet Company allocates factory Indirect costs based upon factory machine hours. For 2012, they estimated factory Indirect costs as $366,400 and machine hours at 19,500. At the end of 2012, they discovered that actual factory indirect costs were $386,900 and actual machine hour were 20,050. By what amount would Hablet have to adjust Its records at year end to conform to GAAP?

$10,000

$10,160

$20,500

$11,00

At the beginning of the year, Coach Ltd. expected to incur $48,000 of overhead costs in producing 6,000 units of product. The direct material cost is $20 per unit of product. Direct labor cost is $30 per unit. During May, 500 units were produced. The total cost of the units produced in May was:

$29,000

$30,000

$25,000

$21,000

How may cost allocation affect a manager's behavior?

A cost driver has a cause and effect relationship with a cost object.

Costs are usually measured in monetary units.

All of the above are true.

Cost is just another term for expense.

Which of the following is true?

Direct manufacturing costs are the same as manufacturing overhead costs.

Managers prefer to classify costs as indirect rather than direct.

A cost pool is a group of individual costs that is allocated to cost objects using a single cost driver.

Cost application is the process of reassigning costs to a cost object

Which of the following costs generally can be traced directly to the baseball bats produced by Schimmer, Inc.?

Wood

Paint

Wages of plant supervisor

Wage of warehouse security guard

Hablet Company allocates factory Indirect costs based upon factory machine hours. For 2012, they estimated factory Indirect costs as $366,400 and machine hours at 19,500. At the end of 2012, they discovered that actual factory indirect costs were $386,900 and actual machine hours were 20,050.

Determine the allocation rate:

$14.40

$18.79

$19.52

$18.27

Which of the following statements Is true?

A period cost is an activity which defines manufacturing costs.

A cost accumulation system is a system by which costs are distributed in an economically feasible manner.

A cost object is an activity for which a seperate measurement is desired.

A product cost refers to a specific period.