Exam 15: Introduction to Management Accounting

Match the descriptions with their terms: -Direct materials and direct labour.

Craft Manufacturing Company's accounting records reflect the following inventories: During 2019, $500,000 of raw materials were purchased, direct labour costs amounted to $600,000, and manufacturing overhead incurred was $480,000. -If Craft Manufacturing Company's cost of goods manufactured for 2019 amounted to $1,390,000, its cost of sales for the year is:

For each item listed below, choose whether the item would be considered an inventoriable cost or a period cost for a manufacturing company. Use the following code: -Direct materials used

For each item listed below, choose whether the item would be considered an inventoriable cost or a period cost for a manufacturing company. Use the following code: -Property rates on factory building

Data for the cost of direct materials for the month ended 31 March 2019, are as follows: During March, the company purchased $200,000 of raw materials on account from Alice Ltd and $72,000 of raw materials for cash from Darwin Ltd. In addition, $50,000 was paid on the Alice account balance. Instructions: Compute the cost of direct materials used during March.

Match the descriptions with their terms: -The function of coordinating diverse activities and human resources of a company.

Prime costs of a company are $6,000,000. If manufacturing overhead is $3,000,000, what is direct labour cost?

Match the descriptions with their terms: -The function of setting goals and objectives.

Which of the following is not a manufacturing cost category?

Match the list of costs and expenses incurred in the factory by Eco Systems Ltd, a manufacturer of eco-friendly, hybrid vehicles with the following categories: -Property rates on the factory land

Match the descriptions with their terms: -The cost of products which are partially complete.

Communication: Quality Acoustics Ltd, a producer of audio equipment for large computer systems, is reviewing its policies as part of a biannual self-examination of the company. As part of this process, all managers have been asked to carefully examine costs and determine as closely as possible which costs are direct and which are indirect. Mary Peters and Sam Wilson, managers of different manufacturing departments in the same building, have been working together. They found the following four costs that could be economically traced to the products, but have historically been a part of overhead: • Cost of setting up the machinery for a different production run. • Cost of minor assembly components such as knobs and switches. • Cost of packaging, which is quite different for each model. • Cost of inspecting and testing each model. None of the costs is significant by itself, but together these four costs make up between 10 and 15 % of the total cost of the product. Mary favours 'leaving well enough alone', as she puts it, and leaving these costs in overhead. She is afraid that her volunteering to trace these costs will result in her having to trace many more costs in the future. Sam, on the other hand, prefers to have the product cost as accurate as possible. He points out that these costs are already known, and the process would require little extra work. Required: You have been called on in your function as accounting manager to resolve the dispute. Write a memo to Mary and Sam, supporting one or the other position. Be sure to adequately defend your position, but be brief.

For each item listed below, choose whether the item would be considered an inventoriable cost or a period cost for a manufacturing company. Use the following code: -Factory supervisory salaries

Match the list of costs and expenses incurred in the factory by Eco Systems Ltd, a manufacturer of eco-friendly, hybrid vehicles with the following categories: -Factory electricity and power

Financial accounting information and managerial accounting information have a number of distinguishing characteristics. For each of the characteristics listed below, indicate which characteristics are more closely related to financial accounting by choosing the letter F and indicate those characteristics which are more closely associated with managerial accounting by choosing the letter M : -Reports generally relate to sub-units

Financial accounting information and managerial accounting information have a number of distinguishing characteristics. For each of the characteristics listed below, indicate which characteristics are more closely related to financial accounting by choosing the letter F and indicate those characteristics which are more closely associated with managerial accounting by choosing the letter M : -Special purpose reports

For each item listed below, choose whether the item would be considered an inventoriable cost or a period cost for a manufacturing company. Use the following code: -Office salaries expense

Which of the following are period costs?

Jenny's Jewellery Ltd has developed the following information for the year ended 31 December 2019: The Work in process inventory on 1 January 2019 was 80% of the work in process inventory on 31 December 2019. Instructions: Prepare a cost of goods manufactured schedule for Jenny's Jewellery Ltd for the year ended 31 December 2019.

Financial accounting information and managerial accounting information have a number of distinguishing characteristics. For each of the characteristics listed below, indicate which characteristics are more closely related to financial accounting by choosing the letter F and indicate those characteristics which are more closely associated with managerial accounting by choosing the letter M : -Reports generally relate to the company as a whole