Cost Classification Quiz
9 multiple-choice questions with answers and explanations · 5 easy, 4 medium
Product and period costs, direct and indirect costs, fixed and variable costs, prime and conversion cost, and the high-low method.
- 1Product Costs vs Period Costs: What Is the Difference?Product costs differ from period costs because product costs are:easy
- 2Product or Period Cost: Factory RentRent paid for the factory building is a:easy
- 3Product or Period Cost: Sales CommissionCommission paid to sales staff is a:easy
- 4Direct Materials: Identifying Them for a Furniture MakerFor a furniture manufacturer, which of the following is a DIRECT material?easy
- 5Fixed Cost vs Variable Cost: Behaviour as Output ChangesAs output rises within the relevant range, a FIXED cost:easy
- 6Prime Cost and Conversion Cost: The CalculationDirect materials are $50,000, direct labour $30,000 and manufacturing overhead $20,000. What are prime cost and conversion cost, in that order?medium
- 7Direct vs Indirect CostsAn INDIRECT cost is one that:medium
- 8High-Low Method: Separating Fixed and Variable CostsAt the highest activity level of 10,000 units total cost was $70,000; at the lowest level of 6,000 units it was $50,000. Using the high-low method, the variable cost per unit and total fixed cost are:medium
- 9Product and Period Costs: Computing Total Product CostA manufacturer incurs direct materials $40,000, direct labour $25,000, factory overhead $15,000, selling expenses $10,000 and administrative expenses $8,000. What is total product cost?medium