ACCT 505 WEEK 4 MIDTERM EXAM
ANSWERS
1. Question : (TCO A) Wages paid to an assembly line worker in a factory are a
:
Prime Cost YES.....Conversion Cost NO.
Prime Cost YES.....Conversion Cost YES.
Prime Cost NO....Conversion Cost NO.
Prime Cost NO.....Conversion Cost YES.
: Chapter 2
2. Question : (TCO A) A cost incurred in the past that is not relevant to any current
decision is classified as a(n)
:
period cost.
incremental cost.
opportunity cost.
None of the above
: Chapter 2
3. Question : (TCO A) Depreciation of office buildings and office equipment is
also known as
:
variable costs.
conversion costs.
product costs.
period costs.
: Chapter 2
4. Question : (TCO A) When the activity level is expected to increase within the
relevant range, what effects would be anticipated with respect to
each of the following?
:
Fixed costs per unit increase and variable costs per unit
, ACCT 505 WEEK 4 MIDTERM EXAM
ANSWERS
increase.
Fixed costs per unit decrease and variable costs per unit do
not change.
Fixed costs per unit do not change and variable costs per
unit do not change.
Fixed costs per unit do not change and variable costs
per unit increase.
: Chapter 5
5. Question : (TCO F) Which of the following statements is true?
I. Overhead application may be made slowly as a job is worked on.
II. Overhead application may be made in a single application at the time of
completion of the job.
III. Overhead application should be made to any job not
completed at year end in order to properly value the work in
process inventory.
:
Only statement I is true.
Only statement II is true.
Both statements I and II are true.
Statements I, II, and III are all true.
: Chapter 3
6. Question : (TCO F) A job-order cost system is employed in those situations where
:
many different products, jobs, or batches of production are
being produced each period.
manufacturing involves a single, homogeneous product that
flows evenly through the production process on a continuous
basis.
the product moves from department to department before
being completed.
ANSWERS
1. Question : (TCO A) Wages paid to an assembly line worker in a factory are a
:
Prime Cost YES.....Conversion Cost NO.
Prime Cost YES.....Conversion Cost YES.
Prime Cost NO....Conversion Cost NO.
Prime Cost NO.....Conversion Cost YES.
: Chapter 2
2. Question : (TCO A) A cost incurred in the past that is not relevant to any current
decision is classified as a(n)
:
period cost.
incremental cost.
opportunity cost.
None of the above
: Chapter 2
3. Question : (TCO A) Depreciation of office buildings and office equipment is
also known as
:
variable costs.
conversion costs.
product costs.
period costs.
: Chapter 2
4. Question : (TCO A) When the activity level is expected to increase within the
relevant range, what effects would be anticipated with respect to
each of the following?
:
Fixed costs per unit increase and variable costs per unit
, ACCT 505 WEEK 4 MIDTERM EXAM
ANSWERS
increase.
Fixed costs per unit decrease and variable costs per unit do
not change.
Fixed costs per unit do not change and variable costs per
unit do not change.
Fixed costs per unit do not change and variable costs
per unit increase.
: Chapter 5
5. Question : (TCO F) Which of the following statements is true?
I. Overhead application may be made slowly as a job is worked on.
II. Overhead application may be made in a single application at the time of
completion of the job.
III. Overhead application should be made to any job not
completed at year end in order to properly value the work in
process inventory.
:
Only statement I is true.
Only statement II is true.
Both statements I and II are true.
Statements I, II, and III are all true.
: Chapter 3
6. Question : (TCO F) A job-order cost system is employed in those situations where
:
many different products, jobs, or batches of production are
being produced each period.
manufacturing involves a single, homogeneous product that
flows evenly through the production process on a continuous
basis.
the product moves from department to department before
being completed.
