Classifying Costs in Accounting Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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Question 1 1. Why is it sometimes beneficial to abandon a project with sunk costs?

Question 2 2. Which of the following BEST describes a sunk cost?

Question 3 3. If you spend $1000 to fix the brakes on your 15-year-old car, and then find out that you also need new tires, which will cost another $1000, what would be the most sensible decision to make?

Question 4 4. Which of the formulas below can be used to calculate the total cost (TC)?

Question 5 5. How are fixed costs related to production levels?

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Question 6 6. Identify the statement that best describes fixed costs.

Question 7 7. How do tracking direct costs affect decisions?

Question 8 8. What is one way direct costs are calculated?

Question 9 9. What are direct costs?

Question 10 10. Which of the following options is an example of a fixed cost?

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Question 11 11. What is a mixed cost a combination of?

Question 12 12. What are costs that do NOT change in relation to production?

Question 13 13. Which of the following statements best defines average total cost?

Question 14 14. What is the average total cost for a computer monitor when fixed costs are $50,000, variable costs are $100, and 2,500 units are produced?

Question 15 15. Which of the following statements is false?

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Question 16 16. A product cost is different from a period cost. Which one is NOT a period cost?

Question 17 17. Which one is calculated by the cost of goods manufactured schedule?

Question 18 18. What type of account is a finished goods inventory account?

Question 19 19. What type of cost remains constant from month to month?

Question 20 20. The formula for total variable cost is _____.

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Question 21 21. Costs that fluctuate proportionally with the fluctuation of output are called _____ costs.

Question 22 22. Select the principle that requires a company to determine which expenses incurred to generate the income (revenue) that the company earned during a certain period.

Question 23 23. Identify the expense that is most likely to be a period cost.

Question 24 24. Which of the following is true about product cost?

Question 25 25. Why is it difficult to manage indirect costs?

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Question 26 26. What threat do indirect costs pose to a company?

Question 27 27. What are indirect costs?

Question 28 28. When should sunk costs be considered in decision-making?

Question 29 29. If total costs are $100,000, variable costs are $1, and 70,000 units were produced, what is the fixed cost?

Question 30 30. Which of the following statements is TRUE?

Classifying Costs in Accounting Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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