chapter 2

Question 1

parts in manufacturing (factory) overhead

Answer 1

indirect materials
indirect labour
other – dep, factory stuff

Question 2

conversion cost

Answer 2

manufacturing overhead + direct labour

Question 3

prime cost

Answer 3

direct labour + direct materials

Question 4

product cost

Answer 4

all costs that are involved in manufacturing the product

Question 5

period cost

Answer 5

selling and admin costs

Question 6

cogs equation

Answer 6

beg finished goods + cogs manufactured - ending finsihed goods

Question 7

variable costs

Answer 7

change with activity

Question 8

fixed costs

Answer 8

unchanged

Question 9

total varibale cost…

Answer 9

changes as activity level

Question 10

variable costs stay the same …

Answer 10

per unit

Question 11

fixed cost per unit …

Answer 11

goes up with activity

Question 12

opportunity cost

Answer 12

potential benefit when giving up one alt for another

Question 13

sunk costs

Answer 13

incurred and not changeable
do not consider when making decisions

Question 14

gross margin formula

Answer 14

sales - cogs

Question 15

diff costs

Answer 15

difference in cost

Question 16

differential rev

Answer 16

diff in rev