Multiple choice

1. The cost of a manufactured product generally consists of which of the following costs?

A. direct materials cost and factory overhead costs

B. direct labor cost and factory overhead costs

C. direct labor cost, direct materials cost, and factory overhead cost

D. direct materials cost and direct labor cost

2. Costs that are treated as assets until the product is sold are called:

A. product costs

B. period costs

C. conversion costs

D. selling expense

3. A manufacturing business typically has the following three types of inventory classifications: raw materials, work-in-process, and finished goods

A. true

B. false

4. Which of the following cost systems would most likely be used by a home builder?

A. job order cost system

B. general cost system’

C. replacement cost system

D. process cost system