Smartbook questions

Question 1

On a traditional income statement, cost of goods sold reports the __________ costs attached to merchandise sold during the period, while selling and administrative expenses report all _________costs that have been expensed as incurred. (Enter only one word per blank.)

Answer 1

product, period

Question 2

Which of the following are most likely fixed costs?

Factory Insurance

Electricity to operate factory machines

Administrative salaries

Factory rent

Answer 2

Factory Insurance
Administrative salaries
Factory rent

Question 3

Administrative costs include ______.

shipping costs and sales commissions

sales commissions and factory supervisors’ salaries

factory maintenance workers’ wages and factory supervisors’ salaries

executive compensation and public relations costs

Answer 3

executive compensation and public relations costs

Question 4

How individual costs react to changes in activity level is referred to as cost ___________

Answer 4

behavior