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If a company wants to determine a products cost, they must assign only direct costs.

If a company wants to determine a products cost, they must assign only direct costs.

If a company wants to determine a product's cost, they must assign only direct costs.

2) Costs can be either direct or indirect, depending upon the cost object.

3) Indirect costs can be traced to specific units.

4) Indirect costs cannot be traced to the cost objects, so they are allocated.

5) Indirect costs incurred in manufacturing autos include all of the following EXCEPT:

A) cost of the engines.

B) machinery depreciation in the factory.

C) plant utilities.

D) plant supervisor salary.

6) When determining the cost of a manufactured product, a factory janitor's wages would be classified as:

A) a direct cost.

B) an indirect cost.

C) a period cost.

D) none of the above.

7) When determining the cost of a manufactured product, a salesperson's salary would be classified as:

A) a direct cost.

B) an indirect cost.

C) a period cost.

D) none of the above.

8) When determining the cost of a manufactured product, the cost of lighting the factory would be classified as:

A) a direct cost.

B) an indirect cost.

C) a period cost.

D) none of the above.

9) All of the following would be considered a direct material for a mattress EXCEPT:

A) fabric.

B) glue.

C) lumber.

D) steel.

10) Prime costs consist of:

A) direct labor and manufacturing overhead.

B) direct materials and direct labor.

C) direct materials and manufacturing overhead.

D) direct materials, direct labor and manufacturing overhead.

Tripti 07-Dec-2019

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