Test Bank for Horngren's Cost Accounting 17th Edition by Srikant M. Datar

Horngren's Cost Accounting: A Managerial Emphasis, 17e by Datar/Rajan
Chapter 2 An Introduction to Cost Terms and Purposes

Objective 2.1

1) Which of the following would be considered an actual cost of a current period?
A) the $25 of materials in a manufactured chair that is ready to be shipped to the customer
B) the $22 of direct material cost per unit assumed in the actual budget of a manufacturer of
chairs
C) the expected cost of materials for a chair as a result of engineering specifications
D) the average of historical material cost data for a chair manufactured in several past
accounting periods
Answer: A
Diff: 2
Objective: 1
AACSB: Analytical thinking

2) The collection of cost data in an organized way, such as in various categories such as
materials, labor,
and manufacturing overhead, is called:
A) cost application
B) cost accumulation
C) cost assignment
D) cost reporting
Answer: B
Diff: 2
Objective: 1
AACSB: Analytical thinking

3) Budgeted costs are:
A) the costs incurred this year
B) the costs incurred last year
C) planned or expected costs
D) competitor's costs
Answer: C
Diff: 1
Objective: 1
AACSB: Analytical thinking

4) Cost assignment:
A) includes future and arbitrary costs
B) associates accumulated costs with certain cost objects
C) is the same as cost accumulation

,D) is the difference between budgeted and actual costs
Answer: B
Diff: 1
Objective: 1
AACSB: Analytical thinking




DOWNLOAD THE Test Bank for Horngrens Cost Accounting 17th Edition Datar
mynursytest.store
2
Copyright © 2021 Pearson Education, Inc.
5) A cost system determines the cost of a cost object by:
A) accumulating and then assigning costs
B) accumulating costs
C) assigning and then accumulating costs
D) assigning costs
Answer: A
Diff: 1
Objective: 1
AACSB: Analytical thinking

6) A cost object is anything for which a cost measurement is desired.
Answer: TRUE
Diff: 1
Objective: 1
AACSB: Analytical thinking

7) Costs are accounted for in two basic stages: assignment followed by accumulation.
Answer: FALSE
Explanation: Costs are accounted for in two basic stages: accumulation followed by
assignment.
Diff: 1
Objective: 1
AACSB: Analytical thinking

8) An actual cost is the cost incurred–a historical or past cost.
Answer: TRUE
Diff: 1
Objective: 1
AACSB: Analytical thinking

1/

,9)/Accountants/define/a/cost/as/the/amount/of/money/spent/on/a/resource./
Answer://FALSE/
Explanation://A/cost/is/a/resource/sacrificed/or/foregone/and/the/requirement/of/"spendi
ng"/or/cash/
expended/is/not/part/of/the/definition./
Diff:/1/
Objective://1/
AACSB://Analytical/thinking/
/
10)/A/cost/is/a/resource/sacrificed/or/forgone/to/achieve/a/specific/objective./
Answer://TRUE/
Explanation://A/cost/object/could/be/anything/management/wishes/to/determine/the/cost
/of,/for/example,/a/
department./
Diff:/1/
Objective://1/
AACSB://Analytical/thinking/
/
11)/Managers/use/assigned/cost/information/to/make/decisions/and/implement/them.//
Answer://TRUE/
Diff:/1/
Objective://1/
AACSB://Analytical/thinking/
/
DOWNLOAD/THE/Test/Bank/for/Horngrens/Cost/Accounting/17th/Edition/Datar
mynursytest.store
3/
Copyright/©/2021/Pearson/Education,/Inc./
12)/Cost/accumulation/and/cost/assignment/are/synonymous./
Answer://FALSE/
Explanation://Cost/accumulation/is/the/collection/of/cost/data/while/cost/assignment/is/t
he/allocation/of/
accumulated/costs/to/specific/cost/objects./
Diff:/1/
Objective://1/
AACSB://Analytical/thinking/
/
13)/Lucas/Manufacturing/has/three/cost/objects/that/it/uses/to/accumulate/costs/for/its/
manufacturing/
plants./They/are:/
/
/
Cost/object/#1:/
The/physical/buildings/and/equipment/

, /
Cost/object/#2:/
The/use/of/buildings/and/equipment/
/
Cost/object/#3:/
The/availability/and/use/of/manufacturing/labor/
/
The/following/manufacturing/overhead/cost/categories/are/found/in/the/accounting/recor
ds:/
/
a./Depreciation/on/buildings/and/equipment/
/
b./Lubricants/for/machines/
/
c./
Property/insurance/
/
d./Supervisors/salaries/
/
e./
Fringe/benefits/
/
f./
Property/taxes/
/
g./Utilities/
/
Required:/
Assign/each/of/the/above/costs/to/the/most/appropriate/cost/object.//
Answer://Cost/object/#/1/includes/categories/a,/c,/and/f./
/
Cost/object/#/2/includes/categories/b/and/g./
/
Cost/object/#/3/includes/categories/d/and/e.//
Diff:/2/
Objective://1/
AACSB://Application/of/knowledge/
/
/
/
DOWNLOAD/THE/Test/Bank/for/Horngrens/Cost/Accounting/17th/Edition/Datar
mynursytest.store
4/
Copyright/©/2021/Pearson/Education,/Inc./
Objective/2.2//
/
1)/Which/of/the/following/factors/affect/the/direct/indirect/classification/of/a/cost?/
A)/the/level/of/budgeted/profit/for/the/next/year//