Question 1

Where would you expect to find ending raw materials inventory?

Accepted Answer

A) on the costs of goods manufactured schedule as an addition to raw materials purchases, and on the Balance Sheet 
B) on the costs of goods manufactured schedule as a subtraction from raw materials available for use, and on the Balance Sheet 
C) only on the Balance Sheet 
D) only the costs of goods manufactured schedule 
A) on the costs of goods manufactured schedule as an addition to raw materials purchases, and on the Balance Sheet 
B) on the costs of goods manufactured schedule as a subtraction from raw materials available for use, and on the Balance Sheet 
C) only on the Balance Sheet 
D) only the costs of goods manufactured schedule

Question 2

To be useful to management accountants for planning and predictive purposes, mixed costs

Accepted Answer

A) must be classified into their fixed and variable elements. 
B) must be classified into their direct and indirect elements. 
C) must be classified into their product and period elements. 
D) none of these. 
A) must be classified into their fixed and variable elements. 
B) must be classified into their direct and indirect elements. 
C) must be classified into their product and period elements. 
D) none of these.

Question 3

How does a manufacturing company classify sales commissions?

Accepted Answer

A) as indirect labour 
B) as product costs 
C) as manufacturing overhead 
D) as period costs 
A) as indirect labour 
B) as product costs 
C) as manufacturing overhead 
D) as period costs

Question 4

Which one of the following represents a period cost?

Accepted Answer

A) company advertisement 
B) depreciation of plant equipment 
C) production manager's salary 
D) direct materials 
A) company advertisement 
B) depreciation of plant equipment 
C) production manager's salary 
D) direct materials

Question 5

Use the following information for questions 
 $\begin{array}{c}
\begin{array}{l}\
\underline{\text { Month }} \
\text { Jan } \
\text { Feb } \
\text { Mar } \
\text { Apr } \
\text { May } \
\text { Jun } \
\text { Jul } \
\text { Aug }
\end{array}
\begin{array}{ll}
\text { \# Machine } & \text { Maintenance } \
 \underline{\text { Hours (X)}} & \underline{ \text { Costs(Y) }}\
3,000 & \$ 440 \
4,500 & \$ 690 \
8,000 & \$ 510 \ 
7,000 & \$ 600 \
6,000 & \$ 550 \
9,000 & \$ 980 \
3,500 & \$ 840 \
5,500 & \$ 600 
\end{array}
\end{array}$

-What is the equation of the line using the high-low method and this data?

Accepted Answer

A) $980 = 170 + (0.09X) 
B) Y = $170 + (0.09 x 9,000) 
C) Y = 170+ ($0.09 X) 
D) X = 170+ ($0.09 Y) 
A) $980 = 170 + (0.09X) 
B) Y = $170 + (0.09 x 9,000) 
C) Y = 170+ ($0.09 X) 
D) X = 170+ ($0.09 Y)

Question 6

Which of the following would most likely be considered direct material?

Accepted Answer

A) wood used to make a chair 
B) lubrication for factory machines 
C) glue used to make a chair 
D) cleaning products used in a factory 
A) wood used to make a chair 
B) lubrication for factory machines 
C) glue used to make a chair 
D) cleaning products used in a factory

Question 7

Which of the following statements is true?

Accepted Answer

A) In real life, the curvilinear nature of variable costs is questionable. 
B) In real life, fixed costs are fixed in total and do not change at various activity levels. 
C) Within the relevant range, there is rarely a straight-line relationship for both variable and fixed costs. 
D) Within the relevant range the linear assumption is valid and useful for cost behaviour analysis. 
A) In real life, the curvilinear nature of variable costs is questionable. 
B) In real life, fixed costs are fixed in total and do not change at various activity levels. 
C) Within the relevant range, there is rarely a straight-line relationship for both variable and fixed costs. 
D) Within the relevant range the linear assumption is valid and useful for cost behaviour analysis.

Question 8

Which one of the following is an example of a period cost?

Accepted Answer

A) a change in benefits for the union workers who work in the Toronto plant of a Fortune 1000 manufacturer 
B) workers' compensation insurance on factory workers wages allocated to the factory 
C) a processor used to produce computers 
D) a manager's salary for work performed in the corporate head office 
A) a change in benefits for the union workers who work in the Toronto plant of a Fortune 1000 manufacturer 
B) workers' compensation insurance on factory workers wages allocated to the factory 
C) a processor used to produce computers 
D) a manager's salary for work performed in the corporate head office

Question 9

In a manufacturing company, the cost of direct labour is treated as an expense when

Accepted Answer

A) products are sold. 
B) products are transferred into work in process inventory. 
C) wages are paid to the employees. 
D) at month end with accruals for wages. 
A) products are sold. 
B) products are transferred into work in process inventory. 
C) wages are paid to the employees. 
D) at month end with accruals for wages.

Question 10

Use the following information for questions 
 $\begin{array}{c}
\begin{array}{l}\
\text { Month } \
\text { Jan } \
\text { Feb } \
\text { Mar } \
\text { Apr } \
\text { May } \
\text { Jun } \
\text { Jul } \
\text { Aug }
\end{array}
\begin{array}{l}
\text { Labour }&\text { Overhead } \
 \underline{\text { Hours (X)}}& \underline{\text { Costs (Y)}}\
200 & \$ 415 \
175 & \$ 385 \
290 & \$ 520 \
300 & \$ 534 \
185 & \$ 403 \
265 & \$ 490 \
160 & \$ 372 \
320 & \$ 564
\end{array}
\end{array}$

-Which of the following choices represents the highest and lowest respective coordinates of activity level and corresponding total overhead costs?

Accepted Answer

A) ($372, 160 labour hours), ($564, 320 labour hours) 
B) ($564, 320 labour hours), ($372, 160 labour hours) 
C) (160 labour hours, $372), (320 labour hours, $564) 
D) (320 labour hours, $564), (160 labour hours, $372) 
A) ($372, 160 labour hours), ($564, 320 labour hours) 
B) ($564, 320 labour hours), ($372, 160 labour hours) 
C) (160 labour hours, $372), (320 labour hours, $564) 
D) (320 labour hours, $564), (160 labour hours, $372)

Question 11

As production manager, Mr.B is asked to track the manufacturing cost per unit on the factory floor.Total manufacturing costs were $100,000 before considering factory maintenance salaries of $12,000 and $50,000 of factory depreciation.How much is the calculation of manufacturing cost per unit if 500 units had been produced in the current quarter?

Accepted Answer

A) $224 
B) $300 
C) $200 
D) $324 
A) $224 
B) $300 
C) $200 
D) $324

Question 12

Which one of the following is most likely a direct material?

Accepted Answer

A) sawdust used to soak up spills in a paint factory 
B) lubricants for factory machinery 
C) paper used in the photocopy machine in the sales office 
D) circuit boards in a computer 
A) sawdust used to soak up spills in a paint factory 
B) lubricants for factory machinery 
C) paper used in the photocopy machine in the sales office 
D) circuit boards in a computer

Question 13

A high-low approach to establishing fixed and variable components of costs is most effective when information available is

Accepted Answer

A) curvilinear. 
B) erratic and highly fluctuating. 
C) outside of the relevant range. 
D) linear. 
A) curvilinear. 
B) erratic and highly fluctuating. 
C) outside of the relevant range. 
D) linear.

Question 14

Mixed costs are

Accepted Answer

A) costs with both indirect and direct elements. 
B) costs with both product and period elements. 
C) costs with both fixed and variable elements. 
D) none of these. 
A) costs with both indirect and direct elements. 
B) costs with both product and period elements. 
C) costs with both fixed and variable elements. 
D) none of these.

Question 15

Which one of the following is classified as direct labour?

Accepted Answer

A) flour in a bakery 
B) wages of factory janitors 
C) bottlers of cola in a bottling company 
D) copy machine costs at a copy shop 
A) flour in a bakery 
B) wages of factory janitors 
C) bottlers of cola in a bottling company 
D) copy machine costs at a copy shop

Question 16

In what category are lubricants that are used for wheel bearings on skateboards produced by a manufacturer categorized?

Accepted Answer

A) selling expense 
B) indirect materials 
C) miscellaneous expense 
D) direct materials 
A) selling expense 
B) indirect materials 
C) miscellaneous expense 
D) direct materials

Question 17

Fees for office telephones are

Accepted Answer

A) fixed period costs. 
B) mixed period costs. 
C) variable period costs. 
D) direct, fixed, or variable period costs. 
A) fixed period costs. 
B) mixed period costs. 
C) variable period costs. 
D) direct, fixed, or variable period costs.

Question 18

Which of the following is a direct cost of a hotel?

Accepted Answer

A) meals in the restaurant 
B) room cleaning 
C) room service 
D) cleaning the lobby 
A) meals in the restaurant 
B) room cleaning 
C) room service 
D) cleaning the lobby

Question 19

During 2020, "cost of goods manufactured" was less than the amount of "Total manufacturing costs" for the period.Which statement is true?

Accepted Answer

A) Ending work in process inventory is greater than beginning work in process inventory. 
B) Ending work in process is less than beginning work in process inventory. 
C) Ending work in process is equal to the cost of goods manufactured. 
D) Ending work in process is less than beginning finished goods inventory. 
A) Ending work in process inventory is greater than beginning work in process inventory. 
B) Ending work in process is less than beginning work in process inventory. 
C) Ending work in process is equal to the cost of goods manufactured. 
D) Ending work in process is less than beginning finished goods inventory.

Question 20

For 2020, Sparkman Company has cost of goods manufactured of $500,000, beginning finished goods inventory of $25,000, and ending finished goods inventory of $20,000.How much is cost of goods sold?

Accepted Answer

A) $505,000 
B) $495,000 
C) $545,000 
D) $455,000 
A) $505,000 
B) $495,000 
C) $545,000 
D) $455,000

Where would you expect to find ending raw materials inventory?

To be useful to management accountants for planning and predictive purposes, mixed costs

How does a manufacturing company classify sales commissions?

Which one of the following represents a period cost?

Use the following information for questions Jan Feb Mar Apr May Jun Jul Aug \# Machine Maintenance 3,000 \ 440 4,500 \ 690 8,000 \ 510 7,000 \ 600 6,000 \ 550 9,000 \ 980 3,500 \ 840 5,500 \ 600 -What is the equation of the line using the high-low method and this data?

Which of the following would most likely be considered direct material?

Which of the following statements is true?

Which one of the following is an example of a period cost?

In a manufacturing company, the cost of direct labour is treated as an expense when

Which one of the following is most likely a direct material?

A high-low approach to establishing fixed and variable components of costs is most effective when information available is

Mixed costs are

Which one of the following is classified as direct labour?

In what category are lubricants that are used for wheel bearings on skateboards produced by a manufacturer categorized?

Fees for office telephones are

Which of the following is a direct cost of a hotel?

During 2020, "cost of goods manufactured" was less than the amount of "Total manufacturing costs" for the period.Which statement is true?

For 2020, Sparkman Company has cost of goods manufactured of $500,000, beginning finished goods inventory of $25,000, and ending finished goods inventory of $20,000.How much is cost of goods sold?

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based-Costing

Cost-Volume-Profit

Incremental Analysis

Alternative Inventory Costing Methods: a Decision-Making Perspective

Pricing

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Filters

Exam 2: Managerial Cost Concepts and Cost Behaviour Analysis

Where would you expect to find ending raw materials inventory?

To be useful to management accountants for planning and predictive purposes, mixed costs

How does a manufacturing company classify sales commissions?

Which one of the following represents a period cost?

Use the following information for questions Jan Feb Mar Apr May Jun Jul Aug \# Machine Maintenance 3,000 \ 440 4,500 \ 690 8,000 \ 510 7,000 \ 600 6,000 \ 550 9,000 \ 980 3,500 \ 840 5,500 \ 600 -What is the equation of the line using the high-low method and this data?

Which of the following would most likely be considered direct material?

Which of the following statements is true?

Which one of the following is an example of a period cost?

In a manufacturing company, the cost of direct labour is treated as an expense when

Which one of the following is most likely a direct material?

A high-low approach to establishing fixed and variable components of costs is most effective when information available is

Mixed costs are

Which one of the following is classified as direct labour?

In what category are lubricants that are used for wheel bearings on skateboards produced by a manufacturer categorized?

Fees for office telephones are

Which of the following is a direct cost of a hotel?

During 2020, "cost of goods manufactured" was less than the amount of "Total manufacturing costs" for the period.Which statement is true?

For 2020, Sparkman Company has cost of goods manufactured of $500,000, beginning finished goods inventory of $25,000, and ending finished goods inventory of $20,000.How much is cost of goods sold?

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based-Costing

Cost-Volume-Profit

Incremental Analysis

Alternative Inventory Costing Methods: a Decision-Making Perspective

Pricing

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Filters