Question

7. Conversion costs are co A, direct materials, direct ect labor and manufacturing C. direct materials and direct D. direct materials and are comprised of: direct labor, and manufacturing overhead. manufacturing overhead. als and direct labor. erials and manufacturing overhead. nt idle capacity to 8. Management is consider till the order without affecting in making the decision? A. absorption costing unit product B. variable costs C. incremental costs D. differential costs onsidering a one-time-only special order. There is su antecting any normal sales. Which one of the follow lowing is NOT relevant costing unit product costs 9. When the activity le the following? activity level declines within the relevant range, what should happe Id happen with respect to A. B. Total fixed cost No change No change Increase Decrease Total variable cost Decrease Increase No charge No charge C. D. A. Option A B. Option B C. Option C D. Option D y-line process. Salaries 500,000; assembly-line Tvisor, RM110,000. The total 10. Light Appliance Bhd. produces washers and dryers in an assembly-line proce incurred during a recent period were: corporate executives, RM500,000; ass workers, RM180,000; security guards, RM45,000; and plant supervisor, RM110,000 of Light Appliance's direct labour cost was: A. RM110,000. B. RM155,000. C. RM180,000. D. RM235,000. 11. A manufacturing firm would begin preparation of its master budget by constructing a: A. sales budget. B. production budget. C. direct materials budget. D. cash budget.

Answer 1

Part 7

Answer is option B

B. direct labor and manufacturing overhead

Conversions costs are incurred in the manufacturing process to convert raw materials into products.

Part 8

Answer is option A

A. absorption costing unit product costs

Variable costs, incremental costs and differential costs are relevant as they affect the decision making. Variable costs have direct relation with the activity level.

Part 9

Answer is option A

	Total fixed cost	Total variable cost
A.	No change	Decrease

Total Fixed cost remain constant irrespective to the activity level. Total variable costs have direct relation with activity level. It increases with increase in activity level and decreases with the decrease in activity level. Per unit variable cost remain the constant.

Part 10

Answer is option C

C. RM180,000

Salaries for corporate executive and security guards are classified as period costs.

Salaries for plant supervisor is classified as manufacturing overhead.

Part 11

Answer is option A

A. Sales budget

The first step in master budget is to prepare sales budget as on the basis of it the number of units to be produced is decided.