Overhead Costs Review Quiz
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Questions and Answers

Which of the following best defines overheads?

  • Direct costs identified with the product manufactured
  • Total of all direct costs
  • Indirect costs not identified with the product manufactured (correct)
  • Total of all indirect costs

    • What is the total of all direct costs known as?

  • Prime cost (correct)
  • Overhead cost
  • Indirect cost
  • Direct cost

    • What is another term for overheads?

  • Direct material costs
  • Indirect expenses (correct)
  • Prime costs
  • Direct labor costs

    • What does prime cost include?

    <p>Direct material cost, direct labour cost, direct expenses</p> Signup and view all the answers

    How are overhead costs classified?

    <p>According to elements, functions, behavior, and controllability</p> Signup and view all the answers

    What is the total of all indirect costs termed as?

    <p>Overhead costs</p> Signup and view all the answers

    Which term refers to costs that can be identified with the product manufactured?

    <p>Direct costs</p> Signup and view all the answers

    What is the total of direct material cost, direct labour cost, and direct expenses known as?

    <p>Prime cost</p> Signup and view all the answers

    Which term refers to costs that cannot be identified with the product manufactured?

    <p>Indirect costs</p> Signup and view all the answers

    What is another term for indirect expenses?

    <p>Overhead costs</p> Signup and view all the answers

    What is the total of all indirect costs termed as?

    <p>Overhead costs</p> Signup and view all the answers

    Which of the following is another term for overheads?

    <p>Indirect costs</p> Signup and view all the answers

    What does the term 'prime cost' include?

    <p>Direct material cost, direct labour cost, direct expenses</p> Signup and view all the answers

    How are overhead costs classified according to behavior?

    <p>According to behavior</p> Signup and view all the answers

    Which of the following best defines overheads?

    <p>Indirect costs not directly identified with the product manufactured</p> Signup and view all the answers

    What is the total of all direct costs, i.e. direct material cost, direct labour cost, and direct expenses known as?

    <p>Prime cost</p> Signup and view all the answers

    Which term refers to costs that cannot be identified with the product manufactured?

    <p>Indirect cost</p> Signup and view all the answers

    What is another term for indirect expenses?

    <p>Overhead expenses</p> Signup and view all the answers

    What does prime cost include?

    <p>Direct material cost, direct labour cost, and direct expenses</p> Signup and view all the answers

    Which term refers to costs that can be identified with the product manufactured?

    <p>Direct cost</p> Signup and view all the answers

    Study Notes

    Costs in Manufacturing

    • Overheads refer to costs that cannot be identified with a specific product or department.
    • The total of all direct costs is known as Prime Cost.
    • Another term for overheads is Indirect Costs or Indirect Expenses.

    Cost Classification

    • Overhead costs are classified as Fixed or Variable according to their behavior.

    Direct and Indirect Costs

    • Costs that can be identified with the product manufactured are known as Direct Costs.
    • Costs that cannot be identified with the product manufactured are known as Indirect Costs or Overheads.

    Prime Cost

    • Prime Cost includes Direct Material Cost, Direct Labour Cost, and Direct Expenses.

    Cost Terms

    • Indirect Costs or Overheads refer to the total of all indirect costs.
    • Another term for Indirect Expenses is Overheads.
    • Direct Costs refer to costs that can be identified with the product manufactured.

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    Description

    Test your knowledge of overhead costs with this review quiz. Explore the meaning, classification, and controllability of overheads with multiple choice questions. Brush up on your understanding of this essential accounting concept.

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