Business Quiz 8 (pt. 2)

The direct labor method of costing is a technique to assign product costs based on links between the daily tasks of a company that drive costs and the production of specific products.

• True

• False

The chief financial officer of NoveauNoir Production Company requests his accountant, Felipe, to prepare a customized report of the cost overruns at the company's production facility in Los Angeles. In this scenario, Felipe is a managerial accountant.

• True

• False

A firm's operating budget represents the firm's overall plan of action for a specified time period.

• True

• False

The deduction of a firm's expenses from its revenue is shown in the income statement of the firm.

• True

• False

Common stock is a key owners' equity account for corporations.

• True

• False

Balance sheets usually classify assets into at least two major categories: current assets and property, plant, and equipment assets.

• True

• False

Intangible assets are assets that have no physical existence—you can't see or touch them—but they still have value.

• True

• False

A static budget is based on a single assumed level of sales and is an excellent tool for planning.

• True

• False

The members of the Financial Accounting Standards Board (FASB) can be reappointed to serve two additional terms after the completion of their first term.

• True

• False

In top-down budgeting, top management prepares the budget with the involvement of the middle and supervisory managers.

• True

• False