Operations Management: Performance Management - CPA Business Environment and Concepts (BEC)
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Of the following, which would be not included as period expenses?
Of the following, which would be not included as period expenses?
Normal spoilage is an inventory cost rather than a period cost.
Normal spoilage is an inventory cost rather than a period cost.
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If a product required a great deal of electricity to produce, and crude oil prices increased, which of the following costs most likely increased?
If a product required a great deal of electricity to produce, and crude oil prices increased, which of the following costs most likely increased?
Conversion costs include both direct labor and overhead. Increases in crude oil prices are likely to impact the costs of generating electricity which is significant in manufacturing costs.
Conversion costs include both direct labor and overhead. Increases in crude oil prices are likely to impact the costs of generating electricity which is significant in manufacturing costs.
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Which of the following costs includes all the product costs?
Which of the following costs includes all the product costs?
Product costs consist of direct materials, direct labor, and factory overhead. Materials and labor together are prime costs, while labor and overhead are conversion costs. Direct materials and conversion costs together are product costs.
Product costs consist of direct materials, direct labor, and factory overhead. Materials and labor together are prime costs, while labor and overhead are conversion costs. Direct materials and conversion costs together are product costs.
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Which of the following best describes direct labor?
Which of the following best describes direct labor?
Direct labor is a prime cost, a conversion costs, and a product cost.
Direct labor is a prime cost, a conversion costs, and a product cost.
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Which of the following is assigned to goods that were either purchased or manufactured for resale?
Which of the following is assigned to goods that were either purchased or manufactured for resale?
Product cost is assigned to goods that were either purchased or manufactured for resale.
Product cost is assigned to goods that were either purchased or manufactured for resale.
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Conversion costs do not include:
Conversion costs do not include:
Conversion costs consist of direct labor and overhead. Thus, conversion costs include all product costs except direct materials.
Conversion costs consist of direct labor and overhead. Thus, conversion costs include all product costs except direct materials.
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Which of the following costs is deducted from revenues of a manufacturing company in order to determine gross margin, but not deducted from revenues to determine contribution margin?
Which of the following costs is deducted from revenues of a manufacturing company in order to determine gross margin, but not deducted from revenues to determine contribution margin?
Under the absorption approach, all fixed and variable manufacturing overhead is part of cost of goods sold to determine an entity's gross margin.
Under the absorption approach, all fixed and variable manufacturing overhead is part of cost of goods sold to determine an entity's gross margin.
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The equivalent units of production method can be calculated by using either:
The equivalent units of production method can be calculated by using either:
Using the FIFO method accounts for work to be finished and using the weighted average method blends the units.
Using the FIFO method accounts for work to be finished and using the weighted average method blends the units.
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A cost that is fixed per unit is an example of a:
A cost that is fixed per unit is an example of a:
A variable cost is one that varies in total but is fixed per unit.
A variable cost is one that varies in total but is fixed per unit.
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There are a variety of ways of classifying costs of an object as either fixed or variable. The most accurate method is considered to be:
There are a variety of ways of classifying costs of an object as either fixed or variable. The most accurate method is considered to be:
The most accurate method and method mentioned within the AICPA text is the regression analysis method.
The most accurate method and method mentioned within the AICPA text is the regression analysis method.
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An example of an internal failure cost is:
An example of an internal failure cost is:
Rework is an internal failure cost.
Rework is an internal failure cost.
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Which of the following statements is correct regarding the difference between the absorption costing and variable costing methods?
Which of the following statements is correct regarding the difference between the absorption costing and variable costing methods?
When production is greater than sales, absorption costing income is greater than variable costing income.
When production is greater than sales, absorption costing income is greater than variable costing income.
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Using the variable costing method, which of the following costs are assigned to inventory?
A: Variable selling and admin costs B: Variable factory overhead costs
Using the variable costing method, which of the following costs are assigned to inventory?
A: Variable selling and admin costs B: Variable factory overhead costs
Under variable costing, only the variable manufacturing costs are assigned to inventory.
Under variable costing, only the variable manufacturing costs are assigned to inventory.
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Which of the following would be classified as a fixed cost?
Which of the following would be classified as a fixed cost?
No matter how much production occurs at the warehouse each year, insurance will remain fixed whereas the more production, the more direct materials cost.
No matter how much production occurs at the warehouse each year, insurance will remain fixed whereas the more production, the more direct materials cost.
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If a product required a great deal of electricity to produce, and crude oil prices increased, which of the following costs most likely increased?
If a product required a great deal of electricity to produce, and crude oil prices increased, which of the following costs most likely increased?
Conversion costs include both direct labor and overhead. Increases in crude oil prices are likely to impact the costs of generating electricity which is significant in manufacturing costs.
Conversion costs include both direct labor and overhead. Increases in crude oil prices are likely to impact the costs of generating electricity which is significant in manufacturing costs.
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Which of the following costs includes all the product costs?
Which of the following costs includes all the product costs?
Product costs consist of direct materials, direct labor, and factory overhead. Materials and labor together are prime costs, while labor and overhead are conversion costs. Direct materials and conversion costs together are product costs.
Product costs consist of direct materials, direct labor, and factory overhead. Materials and labor together are prime costs, while labor and overhead are conversion costs. Direct materials and conversion costs together are product costs.
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Which of the following best describes direct labor?
Which of the following best describes direct labor?
Direct labor is a prime cost, a conversion costs, and a product cost.
Direct labor is a prime cost, a conversion costs, and a product cost.
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Which of the following is assigned to goods that were either purchased or manufactured for resale?
Which of the following is assigned to goods that were either purchased or manufactured for resale?
Product cost is assigned to goods that were either purchased or manufactured for resale.
Product cost is assigned to goods that were either purchased or manufactured for resale.
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Conversion costs do not include:
Conversion costs do not include:
Conversion costs consist of direct labor and overhead. Thus, conversion costs include all product costs except direct materials.
Conversion costs consist of direct labor and overhead. Thus, conversion costs include all product costs except direct materials.
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Of the following, which would be not included as period expenses?
Of the following, which would be not included as period expenses?
Normal spoilage is an inventory cost rather than a period cost.
Normal spoilage is an inventory cost rather than a period cost.
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