14.2: Cost Concepts

Question 1

The cost object is a finished bike. Are bicycle tires and wheels a fixed or variable cost?

Answer 1

Variable

Question 2

The cost object is a finished bike. Are the wages of an assembly a fixed or variable cost?

Answer 2

Variable

Question 3

The cost object is a finished bike. Is advertising a fixed or variable cost?

Answer 3

Fixed

Question 4

The cost object is a finished bike. Is a production manager’s salary a fixed or variable cost?

Answer 4

Fixed

Question 5

The cost object is a finished bike. Is office depreciation a fixed or variable cost?

Answer 5

Fixed

Question 6

The cost object is a finished bike. Is factory depreciation (straight line) a fixed or variable cost?

Answer 6

Fixed

Question 7

The cost object is a finished bike. Is the oil/grease applied to gears and chains a fixed or variable cost?

Answer 7

Variable

Question 8

The cost object is a finished bike. Are sales commissions a fixed or variable cost?

Answer 8

Variable

Question 9

The cost object is a finished bike. Are bicycle tires and wheels a direct or indirect cost?

Answer 9

Direct

Question 10

The cost object is a finished bike. Are the wages of an assembly worker a direct or indirect cost?

Answer 10

Direct

Question 11

The cost object is a finished bike. Is advertising a direct or indirect cost?

Answer 11

Indirect

Question 12

The cost object is a finished bike. Is a production manager’s salary a direct or indirect cost?

Answer 12

Indirect

Question 13

The cost object is a finished bike. Is office depreciation a direct or indirect cost?

Answer 13

Indirect

Question 14

The cost object is a finished bike. Is factory depreciation (straight line) a direct or indirect cost?

Answer 14

Indirect

Question 15

The cost object is a finished bike. Is the oil/grease applied to gears and chains a direct or indirect cost?

Answer 15

Indirect

Question 16

The cost object is a finished bike. Are sales commissions a direct or indirect cost?

Answer 16

Indirect

Question 17

The cost object is a finished bike. Are bicycle tires and wheels a product or period cost?

Answer 17

Product

Question 18

The cost object is a finished bike. Are the wages of an assembly worker a product or period cost?

Answer 18

Product

Question 19

The cost object is a finished bike. Is advertising a product or period cost?

Answer 19

Period

Question 20

The cost object is a finished bike. Is a production manager’s salary a product or period cost?

Answer 20

Product

Question 21

The cost object is a finished bike. Is office depreciation a product or period cost?

Answer 21

Period

Question 22

The cost object is a finished bike. Is factory depreciation (straight line) a product or period cost?

Answer 22

Product

Question 23

The cost object is a finished bike. Is the oil/grease applied to gears and chains a product or period cost?

Answer 23

Product

Question 24

The cost object is a finished bike. Are sales commissions a product or period cost?

Answer 24

Period

Question 25

Is this direct material, direct labor, or overhead? Plastic board used to mount chips.

Answer 25

Direct Material

Question 26

Is this direct material, direct labor, or overhead? Factory maitinence workers' salaries

Answer 26

Overhead

Question 27

Is this direct material, direct labor, or overhead? Real Estate paid on factory.

Answer 27

Overhead

Question 28

Is this direct material, direct labor, or overhead? Factory Supervisor Salary

Answer 28

Overhead

Question 29

Is this direct material, direct labor, or overhead? Depreciation on factory equipment.

Answer 29

Overhead

Question 30

Is this direct material, direct labor, or overhead? Assembly worker hourly pay to make chips.

Answer 30

Direct Labor