Question

From the choices presented in parentheses, choose the appropriate term for completing each of the following sentences: Appropriate term for completing sentencea. Feedback is often used to (improve, direct) operations. ___________________b. The implementation of automatic, robotic factory equipment normally (increases, decreases) the direct labor component of product costs. ___________________c. Advertising costs are usually viewed as (period,product) costs. ___________________d. The balance sheet of a manufacturer would include an account for (cost of goods sold, workin process inventory). ___________________

Answer 1

a. Feedback is often used to improve operations.

Feedback is used to improve operations as it shows the areas that could work better if they were improved upon.

b. The implementation of automatic, robotic factory equipment normally decreases the direct labor component of product costs.

Automated machines do the job faster and do not have to be paid wages so when they are used they reduce the direct labor component of product costs.

c. Advertising costs are usually viewed as period costs.

Period costs are those that are incurred for the period in question and are not related to the manufacturing section so advertising is a period cost.

d. The balance sheet of a manufacturer would include an account for working process inventory.

As manufacturers produce their own goods, they will record a Work in Process inventory instead of a Cost of goods which is for firms that have to purchase inventory.