Exam 15: Management Accounting and Cost Concepts

Tulip Company is a tulip bulb distributor. Every year, Tulip Company plants an outdoor show garden where visitors can see all the varieties of tulips. The garden is open only during the month of April. The original cost to design and landscape the tulip garden is $300,000. Five employees work each day the garden is open. Each employee is paid hourly at a rate of $10 per hour and works for 8 hours each day. Tulip Company pays annual expenses of $1,000 for utilities on the garden property, $800 for property taxes, and $1,200 for insurance on the property. Tulip Company has found that it generally costs $50 per every 100 visitors to upkeep, repair, and maintain the gardens.

In the chart below, list the three main differences between managerial accounting and financial accounting. Managerial Accounting Financial Accounting Source: Purpose: Outcome:

In a manufacturing company, indirect labor is usually classified as a(n):

Which management function implements management plans and identifies how plans compare with actual performance?

You want to go skiing for the day. However, you realize you are scheduled to work. If you call in sick and do not go to work, the wages you will not earn (assuming you are an hourly employee) are considered a(n):

Future costs that change as a result of a decision are:

You want to go skiing for the day. The cost of the lift ticket would be considered a(n):

Accounting information helps management to:

If a cost increases as the sales volume increases, the cost is a:

Which of the following types of costs are most likely to be classified as period costs?

Which of the following is NOT a fundamental characteristic of management accounting as compared to financial accounting?

Advertising, insurance, and executives' salaries are all examples of:

The process of control involves:

Costs that are specifically traceable to a unit of business are known as which of the following costs to that unit?

Mackie Co. manufactures hunting clothing. The standard variable costs to produce one batch of the Big Mac vests are as follows: direct material average cost is $6 per yard; average yards per batch is 20; direct labor average rate per hour is $12; average hours per batch is 4; variable overhead average rate per hour is $8; average hours per batch is 4. The standard monthly fixed costs are as follows: manufacturing overhead is $3,200; selling and administrative costs are $1,900. Mackie Co. produces 100 batches per month. (Ten vests are produced in each batch.) What is the manufacturing cost per vest?

After graduating from college, Mary found what seemed to be an ideal job. However, after a few months she began to notice that some unethical practices were occurring within the company. What three steps should Mary take to resolve these unethical issues?

Which of the following has no inventories?

Costs that are directly traceable to a unit of business or segment being analyzed are called:

Management accounting is established by:

Janet's Jewelry makes sterling silver jewelry. One of the most popular rings, the Love Knot, is produced in batches of 10. The standard variable costs to produce one batch are as follows: direct material average cost is $13 per ounce; average ounces per batch is 20; direct labor average rate per hour is $22; average hours per batch is 10; variable overhead average rate per hour is $10; average hours per batch is 10. The standard monthly fixed costs are as follows: fixed manufacturing overhead is $1,400; selling and administrative costs are $1,500. Janet's Jewelry produces 10 batches per month. What is the manufacturing cost per batch?