Question 1

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-amortization on buildings and equipment
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Amortization on buildings and equipment is considered an indirect cost because it is not directly traceable to a specific product but is necessary for the production process. Therefore, it falls under the cost pool for indirect factory operating costs.

Question 2

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-fringe benefits for factory workers
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Fringe benefits for factory workers are associated with the labor but are not directly traceable to specific units of product, making them an indirect labor cost.

Question 3

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-idle time wages
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Idle time wages are considered indirect factory labor because they are costs related to labor that cannot be directly traced to the production of specific goods or services.

Question 4

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-lubricants for machines
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Lubricants for machines are considered indirect costs because they cannot be directly traced to the production of a specific product but are necessary for the manufacturing process, thus fitting into the indirect factory operating costs pool.

Question 5

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-night security
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Night security is considered an indirect factory operating cost because it is necessary for the operation of the factory but does not directly contribute to the production of specific goods.

Question 6

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-factory worker overtime premiums
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Factory worker overtime premiums are indirect factory operating costs because they are not directly related to the production of goods.

Question 7

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-factory worker overtime premiums
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Factory worker overtime premiums are considered indirect factory labor because they are not directly traceable to a specific product but are necessary for the production process.

Question 8

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-property insurance on the factory
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Property insurance on the factory is considered an indirect cost because it does not directly contribute to the production process but is necessary for the factory's operation. Therefore, it is categorized under indirect factory operating costs.

Question 9

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-property taxes on the administration office
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Property taxes on the administration office are not directly tied to the manufacturing process and are therefore classified as period costs. Period costs are expensed in the period in which they are incurred, rather than being allocated to the cost of producing goods.

Question 10

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-safety hats and shoes
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Safety hats and shoes are considered part of the indirect factory operating costs because they are necessary for the operation but cannot be directly traced to the production of a specific product.

Question 11

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-factory supervisor's salaries
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Factory supervisor's salaries are considered indirect factory labor because supervisors do not directly work on the product but oversee the production process.

Question 12

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-utilities on the administrative building
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Utilities on the administrative building are not directly tied to the manufacturing process and are considered period costs, which are expensed in the period they are incurred rather than being allocated to the cost of producing goods.

Question 13

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost.
-utilities on the factory
A) Cost pool - indirect factory operating costs
B) Cost pool - direct factory labour
C) Cost pool - indirect factory labour
D) Period cost

Accepted Answer

Utilities on the factory are considered indirect costs because they are necessary for the factory's operation but cannot be directly traced to the production of a specific product. Therefore, they are categorized under indirect factory operating costs.

Question 14

Use the information below to answer the following question(s). Macadamia Co. produced and sold 40,000 units last year. Per unit revenue and costs were as follows: Fixed manufacturing overhead and administrative salaries are fixed costs. The per unit amounts are based on last year's production. -Calculate last year's operating income when the company produced and sold 40,000 units. A) $0 B) $<200,000> C) $<500,000> D) $<800,000> E) $<1,000,000>

Accepted Answer

40,000 × [100 - (15 + 30 + 20 + 10)] - [40,000 × (20 + 10)] = $<200,000>

Question 15

Use the information below to answer the following question(s). Macadamia Co. produced and sold 40,000 units last year. Per unit revenue and costs were as follows: Fixed manufacturing overhead and administrative salaries are fixed costs. The per unit amounts are based on last year's production. -Calculate this year's operating income if the company plans to produce and sell 50,000 units. A) $50,000 B) $0 C) $<250,000> D) $<550,000> E) $250,000

Accepted Answer

50,000 × [100 - (15 + 30 + 20 + 10)] - [40,000 × (20 + 10)] = $50,000

Question 16

Use the information below to answer the following question(s). Macadamia Co. produced and sold 40,000 units last year. Per unit revenue and costs were as follows: Fixed manufacturing overhead and administrative salaries are fixed costs. The per unit amounts are based on last year's production. -Calculate this year's operating income if the company plans to produce and sell 60,000 units. A) $150,000 B) $0 C) $<300,000> D) $<650,000> E) $300,000

Accepted Answer

60,000 × [100 - (15 + 30 + 20 + 10)] - [40,000 × (20 + 10)] = $300,000

Question 17

Use the information below to answer the following question(s). Big Island Coffee Co. produced and sold 120,000 units last year. Per unit revenue and costs were as follows: Fixed manufacturing overhead and administrative salaries are fixed costs. The per unit amounts are based on last year's production. -Calculate last year's operating income when the company produced and sold 120,000 units. A) $0 B) $<60,000> C) $<500,000> D) $<800,000> E) $<1,000,000>

Accepted Answer

120,000 × $0.50 = $<60,000>

Question 18

Use the information below to answer the following question(s).
Big Island Coffee Co. produced and sold 120,000 units last year. Per unit revenue and costs were as follows:
  
Fixed manufacturing overhead and administrative salaries are fixed costs. The per unit amounts are based on last year's production.
-Calculate this year's operating income if the company plans to produce and sell 200,000 units.
A) $460,000
B) $0
C) $<100,000>
D) $900,000
E) $980,000

Accepted Answer

200,000 × [35 - (20 + 3 + 2 + 3.50)] - [120,000 × (1 + 6)] = $460,000

Question 19

Use the information below to answer the following question(s). Big Island Coffee Co. produced and sold 120,000 units last year. Per unit revenue and costs were as follows: Fixed manufacturing overhead and administrative salaries are fixed costs. The per unit amounts are based on last year's production. -Calculate this year's operating income if the company plans to produce and sell 60,000 units. A) $120,000 B) $0 C) $<30,000> D) $<100,000> E) $<450,000>

Accepted Answer

60,000 × [35 - (20 + 3 + 2 + 3.50)] - [120,000 × (1 + 6)] = $<450,000>

Question 20

Combs, Inc., reports the following information for September:

Required:
If sales double in October, what is the projected operating income?

Accepted Answer

The answer of Combs, Inc., reports the following information for...

Quiz 2: An Introduction to Cost Terms and Purposes

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -amortization on buildings and equipment

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -fringe benefits for factory workers

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -idle time wages

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -lubricants for machines

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -night security

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -factory worker overtime premiums

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -factory worker overtime premiums

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -property insurance on the factory

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -property taxes on the administration office

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -safety hats and shoes

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -factory supervisor's salaries

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -utilities on the administrative building

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which ar e listed below. Match the type of cost with the most appropriate cost pool or as a period cost. -utilities on the factory

Combs, Inc., reports the following information for September: Required: If sales double in October, what is the projected operating income?