Fundamentals of Cost Accounting 3rd Edition by William N. Lanen, Shannon W. Anderson, Michael Maher

Exercise 49

Basic Concepts

Place the number of the appropriate definition in the blank next to each concept.

Concept		Definition
____ Period cost	1.	Cost that varies with the volume of activity.
____ Indirect cost	2.	Sacrifice of resources.
____ Fixed cost	3.	Cost charged against revenue in a particular accounting period.
____ Opportunity cost	4.	Cost that is part of inventory.
____ Outlay cost	5.	Cost that can more easily be attributed to time intervals.
____ Direct cost	6.	Past, present, or near-future cash flow.
____ Expense	7.	Lost benefit from the best forgone alternative.
____ Cost	8.	Cost used to compute inventory value according to GAAP.
____ Variable cost	9.	Cost that cannot be directly related to a cost object.
____ Full absorption cost	10.	Cost that can be directly related to a cost object.
____ Product cost	11.	Cost that does not vary with the volume of activity.