Q2 - CH 2..MANUFACTURING COST CONCEPT & COMPONENTS

Manufacturing costs that cannot be classified as direct materials or direct labour are classified as manufacturing overhead.

• TRUE

• FALSE

The beginning work in process inventory appears on both the Statement of Financial Position and the Statement of Cost of Goods Manufacturing.

• TRUE

• FALSE

Which one of the following is not a cost element in manufacturing a product?

• Manufacturing overhead

• Direct materials

• Office salaries

• Direct labour

Which one of the following is not considered as material costs?

• Partially completed motor engines for a motorcycle plant

• Bolts used in manufacturing the compressor of an engine

• Rivets for the wings of a new commercial jet aircraft

• Lumber used to build tables

Which of the following is not a manufacturing cost category?

• Cost of goods sold

• Direct materials

• Direct labour

• Manufacturing overhead

Which of the following is not classified as direct labour?

• Bottlers of Pepsi

• Copy machine operators at a copy shop

• Wages of supervisors

• Bakers in a bakery

Manufacturing costs that cannot be classified as either direct materials or direct labour are known as..

• period costs.

• nonmanufacturing costs.

• manufacturing overhead.

• selling and administrative expenses.

Depreciation on office furniture is considered to be a (an).. -

• Administrative costs

• Selling and distribution costs

• Overhead costs

• Negative asset

Prime costs are made up of ..-

• Raw materials costs + direct labour costs

• Direct labour costs + Indirect labour costs

• Factory overheads + administrative costs

• Selling and distribution costs + administrative costs

The formula for calculating the cost of goods sold for manufacturing company is ..-

• Finished goods at beginning of the year + cost of finished goods produced - finished goods at end of the year

• Total manufacturing costs + work-in-progress at beginning of the year - work-in-progress at end of the year

• Finished goods at beginning of the year + cost of sales - finished goods at end of the year

• Finished goods at beginning of the year - cost of finished goods produced - finished goods at end of the year