Select the best definition for the each cost listed below: Costs that change in
ID: 1119264 • Letter: S
Question
Select the best definition for the each cost listed below:
Costs that change in proportion to changes in volume of activity
The potential benefit lost by choosing a specific action from two or more alternatives.
Manufacturing expenditures that cannot be separately or readily traced to finished goods.
Expenditures incurred in the process of converting raw materials to finished products; include direct labor and factory overhead.
Costs that have already been incurred and cannot be avoided or changed.
Expenditures directly associated with the manufacture of finished products; include direct materials and direct labor.
Costs that do not change with changes in the volume of activity.
Costs that are incurred for the benefit of more than one cost object.
Prime Cost
Factory Overhead
Indirect Cost
Opportunity Cost
Variable Cost
Sunk Cost
Conversion Cost
Fixed Cost
-A.B.C.D.E.F.G.H.Costs that change in proportion to changes in volume of activity
-A.B.C.D.E.F.G.H.The potential benefit lost by choosing a specific action from two or more alternatives.
-A.B.C.D.E.F.G.H.Manufacturing expenditures that cannot be separately or readily traced to finished goods.
-A.B.C.D.E.F.G.H.Expenditures incurred in the process of converting raw materials to finished products; include direct labor and factory overhead.
-A.B.C.D.E.F.G.H.Costs that have already been incurred and cannot be avoided or changed.
-A.B.C.D.E.F.G.H.Expenditures directly associated with the manufacture of finished products; include direct materials and direct labor.
-A.B.C.D.E.F.G.H.Costs that do not change with changes in the volume of activity.
-A.B.C.D.E.F.G.H.Costs that are incurred for the benefit of more than one cost object.
A.Prime Cost
B.Factory Overhead
C.Indirect Cost
D.Opportunity Cost
E.Variable Cost
F.Sunk Cost
G.Conversion Cost
H.Fixed Cost
Explanation / Answer
(1) Costs that change in proportion to changes in volume of activity
It is the variable cost that change in proportion to change in volume of activity.
The correct answer is the option (E).
(2)
The potential benefit lost by choosing a specific action from two or more alternatives.
It is the opportunity cost that reflect the loss of potential benefit that arise by choosing a specific action from two or more alternatives.
The correct answer is the option (D).
(3) Manufacturing expenditures that cannot be separately or readily traced to finished goods.
Factory overhead cost is the cost that cannot be separately or readily traced to finished goods.
The correct answer is the option (B).
(4)
Expenditures incurred in the process of converting raw materials to finished products; include direct labor and factory overhead.
It is the conversion cost that represents the expenditures incurred in the process of converting raw materials to finished products; include direct labor and factory overhead.
The correct answer is the option (G).
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