Cost Accounting

Question 1

What are cost objects/cost objectives?

Answer 1

Resources or activities that serve as the basis for management decisions. Cost objects require separate cost measurment

Question 2

What is product cost?

Answer 2

These are all the costs related to the manufacture of the product.. These costs can be attached to the units of output.

Question 3

What does a product cost consist of?

Answer 3

DM, DL and MOH

Question 4

What are period costs?

Answer 4

These are expensed in the period in which they are incurred and not inventoriable

Question 5

What does period costs consist of?

Answer 5

These are the costs of selling the product and administering and managing the operations of the firm

Question 6

What are manufacturing costs?

Answer 6

These are the costs consistent of both direct and indirect costs associated with the manufacture of a product

Question 7

What are prime costs?

Answer 7

DL + DM

Question 8

What are conversion costs?

Answer 8

DL + MOH

Question 9

When is job costing used?

Answer 9

When the cost object is a custom-order

Question 10

When is process costing used?

Answer 10

When the cost object is mass-produced