exam 1 ch2 true and false Flashcards
1
Q
- Total product costs are deducted from total cost of work in process to calculate cost of goods manufactured.
A
f
2
Q
- Variable costs are fixed on a per-unit basis and variable in total.
A
t
3
Q
- Fixed costs appear to vary on a per-unit basis but are fixed in total.
A
t
4
Q
- Cost behaviour analysis is the study of how total costs, concurrently are affected by changes in the level of business activity.
A
f
5
Q
- Variable costs vary exponentially with the changes in the company’s activity level.
A
f
6
Q
- Within the relevant range a valid argument can be made for the assumption of linearity of variable costs
A
t
7
Q
- At the upper and lower limits of the relevant range of company activity, linearity of variable costs is a given
A
f
8
Q
- The relevant range is reflective of the relevant range of products a company offers to its customers
A
f
9
Q
- Fixed costs may jump (rather than remaining fixed) at incremental levels of activity
A
f
10
Q
- Mixed costs are comprised of both fixed costs and variable costs, and as a result, mixed costs increase proportionately with an increase in activity level.
A
f
11
Q
- Mixed costs change in total, but not proportionately with the change in activity level.
A
t
12
Q
- Ending finished goods, work in process, and raw materials inventory appear on the balance sheet of a manufacturing company.
A
t
13
Q
- If the ending work in process inventory is less than the beginning work in process inventory, then the cost of goods manufactured will be less than total manufacturing costs for the period.
A
f
14
Q
- Finished goods inventory for a manufacturing company is equivalent to merchandise inventory for a merchandising company.
A
t
15
Q
- Finished goods inventory represents the cost of completed goods available for sale to customers.
A
f
