Some costs that possibly could be traced directly to cost objects are nonetheless classified as indirect costs because:Multiple ChoiceSuch costs cannot be traced to objects in a cost-effective manner.Such practice results in a more accurate accumulated cost for the objectGenerally accepted accounting principles require some costs to be treated as indirect.All of these answers are correct.

Indirect costs are those costs which cannot be traced or is not cost effective to trace the costs…

Answered: Some costs that possibly could be…

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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Similar questions

Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Which among the following does not hold good for Historical cost accounting? a. Historical cost is relevant for making economic decisions b. Sufficient provision for depreciation is made in historical cost accounting c. Historical cost accounting survives test of time. d. Historical cost is less subject to manipulation.
Direct costs are classified by controllability. True False Can be true, can be false
When using the general methods to estimate cost behavior, A. It is a good idea to use multiple methods so results can be compared B. Managers often apply their own best judgement as a first step in the estimation process C. Results are likely to differ from method to method D. Large differences in methods suggest that the cost cannot be estimated.
A cost that cannot be changed because it arises from a past decision and is irrelevant to future decisions is a. An uncontrollable cost. d. An opportunity cost. b. An out-of-pocket cost. e. An incremental cost. c. A sunk cost.
Briefly explain the importance of distinguishing between relevant and irrelevant costs for the purpose of decision making. Provide at least two examples of situations in which the relevant vs. irrelevant classification is useful
3. Costs of a product that are regarded as an asset for financial reporting under GAAP are called inventoriable costs. O mixed costs. O direct costs. O overhead costs.
Which statement is correct regarding IFRS?(a) An advantage of the nature-of-expense method is that it is simple to apply because allocations of expense to different functions are not necessary.(b) The function-of-expense approach never requires arbitrary allocations.(c) An advantage of the function-of-expense method is that allocation of costs to the varying functions is rarely arbitrary.(d) IFRS requires use of the nature-of-expense approach.
The following statements are correct excerpt? O A. Only avoidable costs are relevant for decision making B. Incremental cost may include both variable and fixed costs OC. All irrelevant costs are sunk costs OD. All direct or indirect cost depends on the cost object
Which of the following is one of the difference between management accounting and cost accounting. Select one: O a. Management accounting is based on double entry system but not cost accounting b. Management accounting used for decision making but cost accounting used for cost ascertainment O c. Management accounting is limited for internal use whereas cost accounting for external use d. Management accounting is optional but cost accounting is mandatory
Explain why using cost as a transfer price is inappropri-ate when the center producing the product is evaluated as a profit center.
TF

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