16.

The cost of the cushions that are used

to manufacture
sofas is best described as a:
a. manufacturing overhead cost.
b. period cost.
c. variable cost.
d. conversion cost.
17. ABC Company manufactures and sells
washing
machines. In order to make assembly of
the machines
faster and easier, some of the metal parts
in the
machines are coated with grease. How
should the cost
of this grease be classified?
Direct Material Cost Fixed Cost
a. Yes Yes
b. Yes No
c. No Yes
d. No No
18. A security guard's wages at a factory
would be an
example of:
19. M
a
n
u
f
acturing overhead includes:
a.all direct material, direct labor and
administrative
costs.
b.all manufacturing costs except direct
labor.
c.all manufacturing costs except direct
labor and direct
materials.
d.all selling and administrative costs.
20. Materials used in the operation of a
factory, such as
cleaning supplies, that are not an integral
part of the
final product should be classified as:
a.direct materials.
b.a period cost.
c.administrative expense.
d.manufacturing overhead.
21. The one cost that would be classified
as part of both
prime cost and conversion cost would be:
a. indirect material.
b. direct labor.
c. direct material.
d. indirect labor.
22. Direct costs:
a. are incurred to benefit a particular
accounting
period.
b. are incurred due to a specific decision.
c. can be easily traced to a particular cost
object.
d. are the variable costs of producing a
product.
23. Prime costs consist of:
a. direct materials and the variable
portion of
manufacturing overhead.
b. direct labor and indirect labor.
c. indirect labor and the fixed portion of
manufacturing overhead.
d. direct labor and direct materials.