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ACCT 505 MIDTERM EXAM QUESTIONS AND ANSWERS

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ACCT 505 MIDTERM EXAM QUESTIONS AND ANSWERS 1. Question : (TCO A) Direct material cost is a part of Student Answer: Conversion Cost NO.... Prime Cost NO. Conversion Cost YES.... Prime Cost NO. Conversion Cost YES.... Prime Cost YES. Conversion Cost NO.... Prime Cost YES. Instructor Explanation: See Chapter 2. Question 2. Question : (TCO A) A cost incurred in the past that is not relevant to any current decision is classified as a(n) Student Answer: period cost. incremental cost. opportunity cost. None of the above Instructor Explanation: See Chapter 2. Question 3. Question : (TCO A) The cost of lubricants used to grease a production machine in a manufacturing company is an example of a(n) Student Answer: period cost. direct material cost. indirect manufacturing

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