Cost concept MCQ

Below Cost concept quiz are Multiple Choice Questions (MCQs) type Quiz. These Cost concept MCQ Questions helps you to refresh your Cost concept, you can see the correct option by clicking on it. .
  • 1. Lake Appliance produces washers and dryers in an assembly-line process. Labor costs incurred during a recent period were: corporate executives, $500,000; assembly-line workers, $180,000; security guards, $45,000; and plant supervisor, $110,000. The total of Lake's direct labor cost was

    • $110,000.
    • $180,000
    • $155,000
    • $235,000
  • 2. 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
  • 3. The wages of a janitor in the factory would be classified as..

    • a period cost
    • direct labour cost
    • indirect labour cost
    • compliance costs.
  • 4. Which one of the following is not a cost element in manufacturing a product?

    • Manufacturing overhead
    • Direct materials
    • Office salaries
    • Direct labour
  • 5. Which one of the following is not a direct material?

    • A tire used for a lawnmower.
    • The plastic used in the covered case for a home PC.
    • The steel used in the manufacturing of steel-radial tires.
    • Lubricant for a ball-bearing joint for a large crane.
  • 6. Cotter pins and lubricants used irregularly in a production process are classified as..

    • miscellaneous expense.
    • direct materials.
    • indirect materials.
    • nonmaterial materials.
  • 7. A manufacturing company calculates the cost of goods sold as follows: .....(FG = finished goods)

    • Beginning FG inventory + cost of goods purchased – ending FG inventory.
    • Ending FG inventory – cost of goods manufactured + beginning FG inventory.
    • Beginning FG inventory – cost of goods manufactured – ending FG inventory.
    • Beginning FG inventory + cost of goods manufactured – ending FG inventory.
  • 8. Both direct materials and indirect materials are..

    • raw materials.
    • manufacturing overhead.
    • merchandise inventory.
    • sold directly to customers by a manufacturing company.
  • 9. Which of the following employees would not be classified as indirect labor?

    • Plant Custodian
    • Salesperson and assembler of wooden furniture
    • Plant security guard.