Listed below are eight technical accounting terms
introduced or emphasized in the reading
Work in process Inventory Cost of finished goods
Conversion Costs Cost of Goods sold
Period Cost Management
Product Cost Manufacturing Overhead
Each of the following statements may or may
not describe one of these technical terms.
For each statement, indicate the accounting term described or answer
None if the statement does not describe any of the terms
The preparation and use of accounting
information designed to assist managers in planning and controlling the
operations of a business
manufacturing costs other than direct materials used and direct labor
materials and direct labor used in manufacturing a product
manufacturing cost that can be traced conveniently and directly to manufactured
units of a product.
account debited at the time that the manufacturing overhead account is credited
amount transferred from the work in process Inventory account to the finished
goods Inventory account.
that are debited directly to expense accounts when the costs are incurred
Into which of the three elements of manufacturing cost would each of the
following be classified?
used in manufacturing bicycles.
paid by an automobile manufacturer to employees who test-drive completed
taxes on machinery.
bullion used by a jewelry manufacturer.
of assembly-line workers who package frozen food.
of plant superintendent.
used in factory operations.
Salary of a nurse in a factory first-aid station.
Indicate whether each of the following should be considered a product
cost or a period cost. If you identify the item as a product cost,
also indicate whether it is a direct or an indirect cost. For
example, the answer to item 0 is "indirect product cost."
Begin with item a.
0. Property taxes on factory building.
of disposal of hazardous waste materials to a chemical plant.
paid by a mobile home manufacturer to a subcontractor who installs
plumbing in each mobile home.
on sales showroom fixtures.
of security guards in administrative office building.
of factory security guards.
of office workers in the credit department.
on raw materials warehouse.
taxes on a profitable manufacturing company.