Which of the following statements is false? O a. Product costs are inventoriable costs O b. Product costs show up on the income statement in cost of goods sold O c. Product costs are automatically deducted and expensed during the current acco period O d. Product costs become expenses when the units are sold

Which of the following statements is false? O a. Product costs are inventoriable costs O b. Product costs show up on the income statement in cost of goods sold O c. Product costs are automatically deducted and expensed during the current acco period O d. Product costs become expenses when the units are sold

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 8MC: Which of the following is not considered a product cost? A. direct materials B. direct labor C....

See similar textbooks

Similar questions

Which of the following is not considered a product cost? A. direct materials B. direct labor C. indirect materials D. selling expense
Product costs are ordinarily found in the traditional Income Statement's Operating Expenses whereas Period costs are ordinarily found in Cost of Goods Sold. TRUE FALSE
Which of the following statements is/are FALSE: I. Because of the prudence convention, inventories are expensed in the income statement as cost of goods sold when they are sold, and not when they are bought in by the business and paid for. II. Investment property does not get depreciated, unless it is measured at cost. III. In the statement of comprehensive income, costs can be analysed according to function or nature. Costs analysed according to function are classified into the following categories: distribution & selling costs; administrative expenses; other operating expenses (or income). IV. A complete set of financial statements consists of the statement of financial position, the statement of comprehensive income, the statement of changes in equity and the statement of cash flows. V. Following the acquisition of an item of property, plant and equipment, subsequent expenditure for this item that will extend the asset's useful life and increase the asset's capacity is capitalised.…
As inventoriable costs expire, they become a. sales b. cost of goods sold c. operating expenses d. gross profit
Which of the following statements is/are FALSE: I. Because of the prudence convention, inventories are expensed in the income statement as cost of goods sold when they are sold, and not when they are bought in by the business and paid for. II. Investment property does not get depreciated, unless it is measured at cost. III. In the statement of comprehensive income, costs can be analysed according to function or nature. Costs analysed according to function are classified into the following categories: distribution & selling costs; administrative expenses; other operating expenses (or income). IV. A complete set of financial statements consists of the statement of financial position, the statement of comprehensive income, the statement of changes in equity and the statement of cash flows. V. Following the acquisition of an item of property, plant and equipment, subsequent expenditure for this item that will extend the asset’s useful life and increase the asset’s capacity is…
Cost of goods sold is an operating expense.A.TrueB.False
Which of the following statements is true? Multiple Cholce Product costs and varlable costs are synonyms. Product costs are excluded from the calculation of gross margin. O Product costs are Included in Inventory as reported on the balance sheet. Product costs Include sales commisslons and advertising.
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
Revenue from sales of the by-product can be listed in the income statement as: a. additional cost to the product b. a deduction from the total manufacturing cost of the by-product c. a deduction from the cost of goods sold of the by-product d. additional sales revenue
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)
4. (A) Which of the following transactions would cause net income for the period to be understated and explain why your answer is correct – feel free to make-up numbers to help your explanation? a. Misclassifying period cost and considering it product cost b. Misclassifying product cost and considering it period cost c. All of the above d. None of the above EXPLAINATION:
S1 - Net income remains the same when revenue is treated as other income, additional revenue, deduction from cost of goods sold, or as deduction from production cost of main product. S2 - In the reversal cost method, the manufacturing cost of the main product is reduced by the actual revenue from the by products. a. Only S1 is true b. Only S2 is true c. Both S1 & S2 are true d. Both S1 & S2 are false