Question 1

Which of the following would most likely be viewed as indirect materials?

Accepted Answer

A) ball bearings associated with an industrial tractor wheel 
B) axle grease associated with the suspension of a new car 
C) new tires for a commercial truck 
D) cost of boring a cylinder in assembly 
A) ball bearings associated with an industrial tractor wheel 
B) axle grease associated with the suspension of a new car 
C) new tires for a commercial truck 
D) cost of boring a cylinder in assembly B

Question 2

Property taxes for the entire manufacturing facility, including the front office and factory area are

Accepted Answer

A) both fixed and variable product costs. 
B) both direct and indirect costs. 
C) both a product and a period cost. 
D) none of the above. 
A) both fixed and variable product costs. 
B) both direct and indirect costs. 
C) both a product and a period cost. 
D) none of the above. C

Question 3

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 D

Question 4

As plant controller, you are trying to determine the costs over which you have the most control on a day-to-day basis.Your goal is to achieve better profitability.The plant operations manager suggests that overhead is the easiest area to directly reduce costs.Which of the following items would be classified as manufacturing overhead?

Accepted Answer

A) factory janitor 
B) general corporate liability insurance 
C) cost of landscaping the corporate office 
D) the western division's vice president's salary 
A) factory janitor 
B) general corporate liability insurance 
C) cost of landscaping the corporate office 
D) the western division's vice president's salary

Question 5

A merchandising company includes cost of goods purchased in its calculation of cost of goods sold.What is the counterpart used by a manufacturing company?

Accepted Answer

A) ending inventory 
B) beginning inventory 
C) cost of goods available for sale 
D) cost of goods manufactured 
A) ending inventory 
B) beginning inventory 
C) cost of goods available for sale 
D) cost of goods manufactured

Question 6

Where would you expect to find depreciation on factory equipment?

Accepted Answer

A) included with Depreciation Expense on the Income Statement 
B) in the manufacturing overhead section of the costs of goods manufactured schedule 
C) only on the Income Statement as part of cost of goods sold 
D) as a period cost in the operating expense section of the Income Statement 
A) included with Depreciation Expense on the Income Statement 
B) in the manufacturing overhead section of the costs of goods manufactured schedule 
C) only on the Income Statement as part of cost of goods sold 
D) as a period cost in the operating expense section of the Income Statement

Question 7

The relevant range is reflective of the relevant range of products a company offers to its customers.

Accepted Answer

A) True 
 B)False

Question 8

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 9

Which one of the following is NOT a manufacturing cost?

Accepted Answer

A) advertising costs 
B) cost of goods sold 
C) manufacturing overhead 
D) direct materials 
A) advertising costs 
B) cost of goods sold 
C) manufacturing overhead 
D) direct materials

Question 10

Which of the following represents the correct order in which inventories are reported on a manufacturer's balance sheet?

Accepted Answer

A) raw materials, work in process, finished goods 
B) work in process, finished goods raw materials 
C) finished goods, work in process, raw materials 
D) work in process, raw materials, finished goods 
A) raw materials, work in process, finished goods 
B) work in process, finished goods raw materials 
C) finished goods, work in process, raw materials 
D) work in process, raw materials, finished goods

Question 11

Direct labour costs plus prime costs equals manufacturing overhead costs.

Accepted Answer

A) True 
 B)False

Question 12

Raw materials inventory is NOT an asset until it is used to make a product.

Accepted Answer

A) True 
 B)False

Question 13

Which one of the following is a product cost?

Accepted Answer

A) indirect labour 
B) office salaries 
C) sales person's salaries 
D) advertising costs 
A) indirect labour 
B) office salaries 
C) sales person's salaries 
D) advertising costs

Question 14

Examples of fixed costs include all but one of the following:

Accepted Answer

A) cost of factory rent for the 12 month contract term. 
B) cost of Janet's apartment rent during her 3rd year of university. 
C) cost of a car rental which includes a fee per km driven. 
D) a one-week rental of a carpet cleaning machine. 
A) cost of factory rent for the 12 month contract term. 
B) cost of Janet's apartment rent during her 3rd year of university. 
C) cost of a car rental which includes a fee per km driven. 
D) a one-week rental of a carpet cleaning machine.

Question 15

Which beginning and ending inventories appear on a cost of goods manufactured schedule?

Accepted Answer

A) raw materials only 
B) raw materials and work in process only 
C) raw materials, work in process, and finished goods 
D) work in process only 
A) raw materials only 
B) raw materials and work in process only 
C) raw materials, work in process, and finished goods 
D) work in process only

Question 16

Variable costs

Accepted Answer

A) vary in total as activity varies. 
B) vary on a per unit basis as activity varies. 
C) are unpredictable. 
D) none of the above. 
A) vary in total as activity varies. 
B) vary on a per unit basis as activity varies. 
C) are unpredictable. 
D) none of the above.

Question 17

Salaries of sales people who only sell one product should best be shown as

Accepted Answer

A) fixed overhead. 
B) variable overhead. 
C) direct selling costs. 
D) indirect selling costs. 
A) fixed overhead. 
B) variable overhead. 
C) direct selling costs. 
D) indirect selling costs.

Question 18

How would you expect to see manufacturing inventories listed on a company's balance sheet?

Accepted Answer

A) in alphabetical order 
B) in order of liquidity 
C) in order from largest to smallest 
D) any order the company desires 
A) in alphabetical order 
B) in order of liquidity 
C) in order from largest to smallest 
D) any order the company desires

Question 19

Hooter Manufacturing Company reported the following year-end information: $\begin{array}{ll}
\text {Beginning work in process inventory }&\$75,000 \
\text { Beginning raw materials inventory}& 20,000\
\text {Ending work in process inventory  }&73,000 \
\text { Ending raw materials inventory}&23,000 \
\text {Raw materials purchased  }& 220,000\
\text {Direct labour.  }&170,000 \
\text {Manufacturing overhead }& 80,000\
\end{array}$
 How much is Hooter Manufacturing's cost of goods manufactured for the year?

Accepted Answer

A) $470,000 
B) $465,000 
C) $469,000 
D) $472,000 
A) $470,000 
B) $465,000 
C) $469,000 
D) $472,000

Question 20

For 2016, 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

Which of the following would most likely be viewed as indirect materials?

Property taxes for the entire manufacturing facility, including the front office and factory area are

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

A merchandising company includes cost of goods purchased in its calculation of cost of goods sold.What is the counterpart used by a manufacturing company?

Where would you expect to find depreciation on factory equipment?

The relevant range is reflective of the relevant range of products a company offers to its customers.

Which one of the following is NOT a manufacturing cost?

Which of the following represents the correct order in which inventories are reported on a manufacturer's balance sheet?

Direct labour costs plus prime costs equals manufacturing overhead costs.

Raw materials inventory is NOT an asset until it is used to make a product.

Which one of the following is a product cost?

Examples of fixed costs include all but one of the following:

Which beginning and ending inventories appear on a cost of goods manufactured schedule?

Variable costs

Salaries of sales people who only sell one product should best be shown as

How would you expect to see manufacturing inventories listed on a company's balance sheet?

For 2016, 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 Cost Accounting

Process Cost Accounting

Activity-Based Costing

Decision-Making: Costvolumeprofit

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

Which of the following would most likely be viewed as indirect materials?

Property taxes for the entire manufacturing facility, including the front office and factory area are

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

A merchandising company includes cost of goods purchased in its calculation of cost of goods sold.What is the counterpart used by a manufacturing company?

Where would you expect to find depreciation on factory equipment?

The relevant range is reflective of the relevant range of products a company offers to its customers.

Which one of the following is NOT a manufacturing cost?

Which of the following represents the correct order in which inventories are reported on a manufacturer's balance sheet?

Direct labour costs plus prime costs equals manufacturing overhead costs.

Raw materials inventory is NOT an asset until it is used to make a product.

Which one of the following is a product cost?

Examples of fixed costs include all but one of the following:

Which beginning and ending inventories appear on a cost of goods manufactured schedule?

Variable costs

Salaries of sales people who only sell one product should best be shown as

How would you expect to see manufacturing inventories listed on a company's balance sheet?

For 2016, 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 Cost Accounting

Process Cost Accounting

Activity-Based Costing

Decision-Making: Costvolumeprofit

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