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Quiz

Cost Final - Chapter 18

Isabel Robles 8 questions

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Questions in this quiz (8)

  1. 1Costs of normal spoilage are usually accounted for as ________.
    1. AA deduction from the cost of goods sold
    2. Ba component of the costs of good units manufactured
    3. Ca "loss from normal spoilage account" in income statement
    4. Da liability on a balance sheet
  2. 2Costs of abnormal spoilage are usually accounted for as ________.
    1. Aa deduction from the cost of goods sold
    2. Ba component of the costs of good units manufactured
    3. Ca separate line item in an income statement
    4. Dan asset on a balance sheet
  3. 3Which of the following statements is true of normal spoilage and abnormal spoilage?
    1. ANormal spoilage is inherent in a particular production process, whereas abnormal spoilage is not inherent in a particular production process.
    2. BAbnormal spoilage arises even when the process is carried out in an efficient manner, whereas normal spoilage does not arise when the process is carried out in an efficient manner.
    3. CNormal spoilage is usually regarded as avoidable and controllable, whereas abnormal spoilage is unavoidable and uncontrollable.
    4. DThe costs of normal spoilage are recorded as a loss as a separate line item in an income statement, whereas costs of abnormal spoilage are included as a component of the costs of good units manufactured.
  4. 4Companies that attempt to achieve zero defects in the manufacturing process treat spoilage as ________.
    1. Ascrap
    2. Breworked units
    3. Cabnormal spoilage
    4. Dindirect spoilage
  5. 5Which one of the following conditions usually exists when comparing normal and abnormal spoilage to controllability?

    Normal Spoilage | Abnormal Spoilage
    1. AControllable | Controllable
    2. BControllable | Uncontrollable
    3. CUncontrollable | Uncontrollable
    4. DUncontrollable | Controllable
  6. 6Under the FIFO method, all spoilage costs are assumed to be related to the units ________.
    1. Ain beginning inventory, plus the units completed during the period
    2. Bcompleted during the period
    3. Cin ending inventory
    4. Din both beginning and ending inventory plus the units completed during the period
  7. 7The inspection point is the ________.
    1. Astage of the production cycle where products are checked to determine whether they are acceptable or unacceptable units
    2. Bpoint at which costs are allocated between normal and abnormal spoilage
    3. Cpoint at which the calculation of equivalent units is made
    4. Dstage of allocating total costs transferred out to good units completed and transferred
  8. 8When spoiled goods have a disposal value, the net cost of the spoilage is computed by ________.
    1. Adeducting disposal value from the costs of the spoiled goods accumulated to the inspection point
    2. Badding the costs to complete a saleable product to the costs accumulated to the inspection point
    3. Cdeducting the costs to complete a saleable product from the costs accumulated to the inspection point
    4. Dadding disposal value to the costs of the good units transferred

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Exam 1 Cost Accounting Quiz on Cost Final - Chapter 18, created by Isabel Robles on 25/05/2016.
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