1. Give three examples of product cost definitions. Why do we need different product cost definitions?
2. Identify the three cost elements that determine the cost of making a product (for external reporting).
3. How do the income statements of a manufacturing firm and a service firm differ?
4. Describe some of the major differences between a functional-based cost management system and an activity-based cost management system.
5. When would a company choose an activity-based cost management system over a functional-based system? What forces are moving firms to implement activity-based cost management systems?