CHECKPOINT ACTIVITY 1:

This activity is designed to check your understanding of the material read.

You are encouraged not to look at the any reference material in doing this
task. This activity will be counted as your participation for today’s activity.
This will be ungraded yet this will be counted as proof of your
participation.
After reading the material and/or watching the videos, define the following
terms:

TERM/CONCEPT DEFINITION
Mixed cost It refers to both the variable and fixed component.
Prime cost It pertains to the sum of direct labor and direct
materials.
Variable cost A cost that varies in proportionately with changes in
activity.
Indirect cost They are costs that cannot be traced to a cost object but
allocated.
Conversion cost It is the sum of direct labor and manufacturing overhead
which are attributed in the process of conversion into
products.
Cost object It is anything for which management wants to collect
costs.
Fixed cost It is a cost that remains constant in total within the
relevant range of activity.
Inventoriable They are also called product costs, which are directly
cost related in the process of creation of products.
Step cost It shifts upward or downward when activity changes by
a certain step.