Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
16th Edition
ISBN: 9780134475585
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Textbook Question
Chapter 2, Problem 2.40P
Interpretation of statements (continuation of 2-39)
- 1. How would the answer to Problem 2-39 be modified if you were asked for a schedule of cost of goods manufactured and sold instead of a schedule of cost of goods manufactured? Be specific.
Required
- 2. Would the sales manager’s salary (included in marketing, distribution, and customer-service costs) be accounted for any differently if the Howell Corporation were a merchandising-sector company instead of a manufacturing-sector company?
- 3. Using the flow of
manufacturing costs outlined in Figure 2-9 (page 44), describe how the wages of an assembler in the plant would be accounted for in this manufacturing company. - 4. Plant supervisory salaries are usually regarded as manufacturing
overhead costs. When might some of these costs be regarded as direct manufacturing costs? Give an example. - 5. Suppose that both the direct materials used and the plant and equipment depreciation are related to the manufacture of 1 million units of product. What is the unit cost for the direct materials assigned to those units? What is the unit cost for plant and equipment depreciation? Assume that yearly plant and equipment depreciation is computed on a straight-line basis.
- 6. Assume that the implied cost-behavior patterns in requirement 5 persist. That is, direct material costs behave as a variable cost and plant and equipment depreciation behaves as a fixed cost. Repeat the computations in requirement 5, assuming that the costs are being predicted for the manufacture of 1.2 million units of product. How would the total costs be affected?
- 7. As a
management accountant , explain concisely to the president why the unit costs differed in requirements 5 and 6.
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1. Which of the following would not be considered as a component of the "cost" of Goods Sold?a. Salesforce salariesb. Transportation purchasec. Import duties or raw materiald. Factory electricity expense
2. Revenue minus all direct costing of making the goods or supplying the service is known as?a. Gross profitb. Cost of salesc. Expensesd. Net profit
3. During the costing process, to arrive at the gross profit of a trading business, which one of the following formulas is applied?a. Sales - (Beginning Inventory - Purchases - Ending Inventory)b. Sales - (Beginning Inventory + Purchases + Ending Inventory)c. Sales - (Beginning Inventory + Purchases - Ending Inventory)d. Sales - (Beginning Inventory - Purchases + Ending Inventory)
I. The Cost of Goods Sold of a Merchandising company will include cost of Materials, Labor and Factory Overhead. II. A Merchandising company's Cost of Goods Sold will include Purchases.A. Statement I is false while statement II is true.B. Both statements are true.C. Both statements are false.D. Statement I is true while statement II is false.
Which of the following would not be a period cost?
Group of answer choices
Sales commissions.
Accounting costs.
Sales salaries.
Tamper-proof packaging.
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Chapter 2 Solutions
Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
Ch. 2 - Define cost object and give three examples.Ch. 2 - Define direct costs and indirect costs.Ch. 2 - Prob. 2.3QCh. 2 - Name three factors that will affect the...Ch. 2 - Define variable cost and fixed cost. Give an...Ch. 2 - What is a cost driver? Give one example.Ch. 2 - What is the relevant range? What role does the...Ch. 2 - Explain why unit costs must often be interpreted...Ch. 2 - Prob. 2.9QCh. 2 - What are three different types of inventory that...
Ch. 2 - Distinguish between inventoriable costs and period...Ch. 2 - Define the following: direct material costs,...Ch. 2 - Describe the overtime-premium and idle-time...Ch. 2 - Define product cost. Describe three different...Ch. 2 - What are three common features of cost accounting...Ch. 2 - Prob. 2.16MCQCh. 2 - Comprehensive Care Nursing Home is required by...Ch. 2 - Frisco Corporation is analyzing its fixed and...Ch. 2 - Year 1 financial data for the ABC Company is as...Ch. 2 - The following information was extracted from the...Ch. 2 - Computing and interpreting manufacturing unit...Ch. 2 - Direct, indirect, fixed, and variable costs....Ch. 2 - Classification of costs, service sector. Market...Ch. 2 - Classification of costs, merchandising sector....Ch. 2 - Classification of costs, manufacturing sector. The...Ch. 2 - Variable costs, fixed costs, total costs. Bridget...Ch. 2 - Variable and Fixed Costs. Consolidated Motors...Ch. 2 - Variable costs, fixed costs, relevant range. Gummy...Ch. 2 - Prob. 2.29ECh. 2 - Cost drivers and functions. The representative...Ch. 2 - Total costs and unit costs, service setting....Ch. 2 - Total and unit cost, decision making. Gayles...Ch. 2 - Inventoriable costs versus period costs. Each of...Ch. 2 - Computing cost of goods purchased and cost of...Ch. 2 - Cost of goods purchased, cost of goods sold, and...Ch. 2 - Flow of Inventoriable Costs. Renkas Heaters...Ch. 2 - Cost of goods manufactured, income statement,...Ch. 2 - Cost of goods manufactured, income statement,...Ch. 2 - Income statement and schedule of cost of goods...Ch. 2 - Interpretation of statements (continuation of...Ch. 2 - Income statement and schedule of cost of goods...Ch. 2 - Terminology, interpretation of statements...Ch. 2 - Labor cost, overtime, and idle time. David...Ch. 2 - Missing records, computing inventory costs. Ron...Ch. 2 - Comprehensive problem on unit costs, product...Ch. 2 - Prob. 2.46PCh. 2 - Cost classification; ethics. Paul Howard, the new...Ch. 2 - Prob. 2.48P
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