Test Bank - for Fundamentals of Cost Accounting, 7th Edition by Lanen Maher All Chapters 1-17 Complete Guide A+

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Chapterg02gC


ostgConceptsgandgBehavior



Trueg/gFalsegQuestions



1. Thegcostgofgangitemgisgthegsacrificegofgresourcesgmadegtogacquiregit.



True False


2. Angexpensegisgagcostgchargedgagainstgrevenuegingangaccountinggperiod.



True False


3. Ifgagcostgisgrecordedgasgangassetg(forgexample,gprepaidgrentgforgangofficegbuilding),gitgbecome

sgangexpensegwhengthegassetghasgbeengconsumed.



True False


4. Accountinggsystemsgtypicallygrecordgopportunitygcostsgasgassetsgandgtreatgthemgasgintangi

blegitemsgongthegfinancialgstatements.



True False


5. Totalgcostgofggoodsgpurchasedgminusgbeginninggmerchandiseginventorygplusgendinggmerchandi

seginventorygequalsgcostgofggoodsgsold.



True False



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6. Costgofggoodsgsoldgincludesgthegactualgcostsgofgtheggoodsgsoldgandgthegcostsgrequiredgtogsellgt

hemgtogthegcustomer.



True False


7. Periodgcostsgaregthosegcostsgassignedgtogunitsgofgproductiongingthegperiodgingwhichgthey

garegincurred.




True False


8. Onlygdirectgcostsgcangbegclassifiedgasgproductgcosts;gindirectgcostsgaregclassifiedgasgperiodgcosts.



True False


9. Thegthreegcategoriesgofgproductgcostsgaregdirectgmaterials,gdirectglabor,gandgmanufacturi

nggoverhead.



True False


10. Thegfirstgstepgingdetermininggwhethergagcostgisgdirectgorgindirectgisgtogspecifygthegcostgalloc

ationgrule.



True False


11. Totalgwork-in-processgduringgthegperiodgisgthegsumgofgthegbeginninggwork-in-

processginventorygandgthegtotalgmanufacturinggcostsgincurredgduringgthegperiod.



True False




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12. Costgofggoodsgsoldgplusgthegendinggfinishedggoodsginventorygminusgthegbeginninggfinishedggo

odsginventorygequalsgthegcostgofggoodsgmanufactured.



True False


13. Ifgthegcostgofggoodsgmanufacturedgduringgthegperiodgexceedsgthegcostgofggoodsgsold,gthegen

dinggbalancegofgFinishedgGoodsgInventorygaccountgincreased.



True False


14. Totalgvariablegcostsgchangeginverselygwithgchangesgingthegvolumegofgactivity.



True False


15. Fixedgcostsgpergunitgchangeginverselygwithgchangesgingthegvolumegofgactivity.



True False


16. Thegrangegwithingwhichgfixedgcostsgremaingconstantgasgvolumegofgactivitygvariesgisgknowngas

gthegrelevantgrange.




True False


17. Thegtermgfullgcostgrefersgtogthegcostgofgmanufacturinggandgsellinggagunitgofgproductgandgincl

udesgbothgfixedgandgvariablegcosts.



True False


18. Variablegmarketinggandgadministrativegcostsgaregincludedgingdetermininggfullgabsorptiongcosts.



True False




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19. Revenuegminusgcostgofggoodsgsoldgequalsgcontributiongmargin.



True False


20. Thegprimaryggoalgofgthegcostgaccountinggsystemgisgtogprovidegmanagersgwithginformatio
ngtogpreparegtheirgannualgfinancialgstatements.



True False




MultiplegChoiceg Questions



21. Angopportunitygcostgis




A. agcostgthatgisgchargedgagainstgrevenuegingangaccountinggperiod.

B. thegforegonegbenefitgfromgthegbestgalternativegcoursegofgaction.

C. thegexcessgofgoperatinggrevenuesgovergoperatinggcosts.

D. thegcostgassignedgtogthegproductsgsoldgduringgthegperiod.


22. Whichgofgthegfollowinggstatementsgisg(are)gtrue?


(1). Angassetgisgagcostgthatgwillgbegmatchedgwithgrevenuesgingagfuturegaccountinggperiod.

(2). Opportunitygcostsgaregrecordedgasgintangiblegassetsgingthegcurrentgaccountinggperiod.




A. Onlyg(1)gisgtrue.

B. Onlyg(2)gisgtrue.

C. Bothg(1)gandg(2)garegtrue.

D. Neitherg(1)gnorg(2)garegtrue.



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