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1. Which of the fol absorption costing and variable costing Equipment depreciation. B) Variable manufacturing costs. A) C) Variable selling expenses. D) Supervisory salaries. 1 method that can be used most easily with break-even analysis and

1. Which of the fol absorption costing and variable costing Equipment depreciation. B) Variable manufacturing costs. A) C) Variable selling expenses. D) Supervisory salaries. 1 method that can be used most easily with break-even analysis and

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Answer 1. Which of the following costs/expenses is included in product costs under both absorption costing and variable costing? A) Equipment depreciation. B) Variable manufacturing costs. Variable selling expenses. D) Supervisory salaries. 2. What is the costing method that can be used most easily with break-even analysis and other cost-volume-profit techniques? A) Process costing. B) Job-order costing. C) Absorption costing. D) Variable costing. 3. The Predetermined Overhead Rate is $18.50 per machine hour. During the year, actual manufacturing overhead expenses incurred were $456,000 and the machine operated for 24,550 hours. This means: A) Manufacturing overhead is overapplied B) Before any adjustments, net income is understated C) No journal entry is needed D) The balance in the MOH account is zero E) None of the above 4. Why would an activity-based costing system that is designed for internal decision making NOT conform to generally accepted accounting principles? A) First-stage allocations may be based on subjective interview data. B) Some manufacturing costs (i.e., the costs of idle capacity and organization- sustaining costs) will not be assigned to products. C) Some non-manufacturing costs are assigned to products. D) All of the above. 5. Under variable costing, which of the following costs are treated as period costs? A) Only fixed selling and administrative costs. B) All fixed costs. C) Only fixed manufacturing costs. D) Both variable and fixed manufacturing costs.
Transcribed Image Text:Answer 1. Which of the following costs/expenses is included in product costs under both absorption costing and variable costing? A) Equipment depreciation. B) Variable manufacturing costs. Variable selling expenses. D) Supervisory salaries. 2. What is the costing method that can be used most easily with break-even analysis and other cost-volume-profit techniques? A) Process costing. B) Job-order costing. C) Absorption costing. D) Variable costing. 3. The Predetermined Overhead Rate is $18.50 per machine hour. During the year, actual manufacturing overhead expenses incurred were $456,000 and the machine operated for 24,550 hours. This means: A) Manufacturing overhead is overapplied B) Before any adjustments, net income is understated C) No journal entry is needed D) The balance in the MOH account is zero E) None of the above 4. Why would an activity-based costing system that is designed for internal decision making NOT conform to generally accepted accounting principles? A) First-stage allocations may be based on subjective interview data. B) Some manufacturing costs (i.e., the costs of idle capacity and organization- sustaining costs) will not be assigned to products. C) Some non-manufacturing costs are assigned to products. D) All of the above. 5. Under variable costing, which of the following costs are treated as period costs? A) Only fixed selling and administrative costs. B) All fixed costs. C) Only fixed manufacturing costs. D) Both variable and fixed manufacturing costs.
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