1. I will only give points for correct answers. Short explanation by the multiple choice question please.

2. Multiple choice Questions

3. Which of the following expenses are reported on the income statement as expenses when they are incurred?

   		Product costs
   		Period costs
   		Indirect material
   		Direct material

4. Manufacturing costs are first recorded as an asset on the balance sheet and then expensed on the income statement at the time

   		They are purchased
   		They are put into production
   		They are completed.
   		They are sold.

5. Which of the following accounts is similar to the Inventory account of a merchandising company?

6. 		Raw Materials Inventory
   		Work in Process Inventory
   		Finished Goods Inventory
   		Manufacturing Overhead

   Which of the following is not included in the schedule of cost of goods manufactured?

   Direct materials in inventory

   Direct materials used in production

   Direct labor

   Overhead

   Which of the following is not a characteristic of a bottom-up budget environment?

   Executive management creates the budget.

   At each higher level of management, the budget is reviewed and may be altered.

   The budget approach may also be referred to as participative budgeting.

   All of the above are characteristics of a bottom-up budget environment.

   1. Overhead is typically divided into which of the following components?

      		Direct and indirect
      		Fixed and variable
      		Product and period
      		Controllable and non-controllable.