Question Details

Whichofthefollowingcostswouldbeconsideredadirectmaterial 



1.	Ifthetotalwarehousingcostfortheyearamountsto$450,000,and40percentofthewarehousingactivityisassociatedwithfinishedgoodsand60percentwithdirectmaterials,howmuchofthecostwouldbechargedasaproductcost?
a.$90,000
b.$180,000
c.$270,000
d.$450,000


2.	Whichofthefollowingcostswouldbeincludedaspartofdirectmaterialsintheproductionofanautomobile?
a.	glueforastickerappliedtotheautomobile
b.	steel
c.	gasolineusedtofuelmachinesinproduction
d.	noneofthese


3.	AllofEvaEnterprise'soperationsarehousedinonebuildingwiththecostsofoccupyingthebuildingaccumulatedinaseparateaccount.ThetotalcostsincurredinJulyamountedto$48,000.Thecompanyallocatesthesecostsonthebasisofsquarefeetoffloorspaceoccupied.Administrativeoffices,salesoffices,andfactoryoperationsoccupy9,000,6,000,and30,000squarefeet,respectively.HowmuchwillbeclassifiedasaproductcostforJuly?
a.$9,600
b.$6,400
c.$16,000
d.$32,000

4.	Whichofthefollowingcostswouldbeconsideredadirectmaterial ?
a.	glueintheproductionofautomobiles
b.	laborusedtofinishproduct
c.	paperusedintheproductionofbooks
d.	depreciationonthecorporation'sofficebuilding


5.	Thedifferencebetweenasupplyandanindirectmaterialisthat
a.	suppliesarenotnecessaryforproduction.
b.	indirectmaterialsarenotphysicallypartoftheproduct.
c.	suppliesarenotnecessaryforproductionandarenotphysicallypartoftheproduct.
d.	suppliesarenecessaryforproductionandarenotphysicallypartoftheproduct.




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