Question 1

The following information applies to the Johnson Tools Company for the year ended December 31,2010:

Accepted Answer

@#IMG-DLM& 
Required:Prepare a statement

Question 2

Factory overhead costs for a given period were 2 times as much as the direct material costs.Prime costs totaled $8,000.Conversion costs totaled $11,350.What are the direct labor costs for the period?

Accepted Answer

A) $4,650. 
B) $3,560. 
C) $4,200. 
D) $3,860.
$11,350 = Direct Labor Costs + Factory Overhead Costs
Direct Labor Costs = $8,000 - Direct Materials Costs
Factory Overhead Costs = 2(Direct Materials Costs)
Solve for Direct Materials Costs via substitution:
$11,350 = ($8,000 - Direct Materials Costs)+ 2(Direct Materials Costs)
Direct Materials Costs = $3,350
Direct Labor Costs = $8,000 - $3,350 = $4,650 
A) $4,650. 
B) $3,560. 
C) $4,200. 
D) $3,860.
$11,350 = Direct Labor Costs + Factory Overhead Costs
Direct Labor Costs = $8,000 - Direct Materials Costs
Factory Overhead Costs = 2(Direct Materials Costs)
Solve for Direct Materials Costs via substitution:
$11,350 = ($8,000 - Direct Materials Costs)+ 2(Direct Materials Costs)
Direct Materials Costs = $3,350
Direct Labor Costs = $8,000 - $3,350 = $4,650

Question 3

Dave's Lighting Inc.produces lamps.During 2010,the company incurred the following costs:

Accepted Answer

@#IMG-DLM& 
Inventories for the year wer

Question 4

Jeffrey's Bottling Co.incurred the following costs during 2010:  
If direct materials cost was $140,000 in 2010,what was the conversion cost for year 2010?

Accepted Answer

A) $255,000 
B) $240,000 
C) $215,000 
D) $235,000
Direct Labor Cost = $220,000 - $140,000 = $80,000
Conversion Cost = $80,000 + $175,000 = $255,000 
A) $255,000 
B) $240,000 
C) $215,000 
D) $235,000
Direct Labor Cost = $220,000 - $140,000 = $80,000
Conversion Cost = $80,000 + $175,000 = $255,000

Question 5

Furniture Co.incurred the following costs during 2010:  
What was the amount of direct materials and direct labor used for the year?

Accepted Answer

A) A 
B) B 
C) C 
D) D
= Labor + $115,000 = $240,000;Labor = $125,000.Materials + $125,000 = $210,000 = Prime Costs.Materials = $85,000 
A) A 
B) B 
C) C 
D) D
= Labor + $115,000 = $240,000;Labor = $125,000.Materials + $125,000 = $210,000 = Prime Costs.Materials = $85,000

Question 6

The following data pertains to Lam Co.'s manufacturing operations:  
Additional information for the month of April:  
Overhead is applied at $10 per direct labor hour.
For the month of April,prime cost incurred was:

Accepted Answer

A) $75,000. 
B) $69,000. 
C) $45,000. 
D) $39,000.
= $75,000 = Material (($18,000 + 42,000-15,000)= $45,000)plus Direct labor of $30,000 
A) $75,000. 
B) $69,000. 
C) $45,000. 
D) $39,000.
= $75,000 = Material (($18,000 + 42,000-15,000)= $45,000)plus Direct labor of $30,000

Question 7

The following information was taken from the accounting records of Elliott Manufacturing Corp.Unfortunately,some of the data were destroyed by a computer malfunction.  
Cost of goods manufactured is calculated to be:

Accepted Answer

A) $32,000. 
B) $30,000. 
C) $33,000. 
D) $38,000. 
E) $27,000. 
A) $32,000. 
B) $30,000. 
C) $33,000. 
D) $38,000. 
E) $27,000.

Question 8

Manufacturing firms use which of the following three inventory accounts?

Accepted Answer

A) Materials,Work-in-process,Transferred-out. 
B) Materials,Work-in-process,Finished goods. 
C) Materials,Finished goods,Transferred out. 
D) Work-in-process,Finished goods,Transferred-out. 
A) Materials,Work-in-process,Transferred-out. 
B) Materials,Work-in-process,Finished goods. 
C) Materials,Finished goods,Transferred out. 
D) Work-in-process,Finished goods,Transferred-out.

Question 9

A manufacturer of machinery currently produces equipment for a single client.The client supplies all required raw material on a no-cost basis.The manufacturer contracts to complete the desired units from this raw material.The total production costs incurred by the manufacturer are correctly identified as:

Accepted Answer

A) Prime costs. 
B) Conversion costs. 
C) Variable production costs. 
D) Factory overhead. 
A) Prime costs. 
B) Conversion costs. 
C) Variable production costs. 
D) Factory overhead.

Question 10

Assume the following information pertaining to Cub Company:  
Factory overhead is calculated to be:

Accepted Answer

A) $110,000. 
B) $136,000. 
C) $111,000. 
D) $84,000. 
E) $112,000. 
A) $110,000. 
B) $136,000. 
C) $111,000. 
D) $84,000. 
E) $112,000.

Question 11

The following data pertains to Lam Co.'s manufacturing operations:  
Additional information for the month of April:  
Overhead is applied at $10 per direct labor hour.
For the month of April,cost of goods manufactured was:

Accepted Answer

A) $118,000. 
B) $115,000. 
C) $112,000. 
D) $109,000.
$118,000 = $9,000 + ($42,000 + $18,000 - $15,000)+ $30,000 + $40,000 - $6,000
Overhead incurred = overhead applied = ($30,000/$7.50)x $10 = $40,000 
A) $118,000. 
B) $115,000. 
C) $112,000. 
D) $109,000.
$118,000 = $9,000 + ($42,000 + $18,000 - $15,000)+ $30,000 + $40,000 - $6,000
Overhead incurred = overhead applied = ($30,000/$7.50)x $10 = $40,000

Question 12

The range of the cost driver in which the actual value of the cost driver is expected to fall is called the:

Accepted Answer

A) Actual cost range. 
B) Driver range. 
C) Activity range. 
D) Expected cost range. 
E) Relevant Range. 
A) Actual cost range. 
B) Driver range. 
C) Activity range. 
D) Expected cost range. 
E) Relevant Range.

Question 13

The following information applies to the General Lawnmower Company for the year ended December 31,2010:

Accepted Answer

@#IMG-DLM& 
Required:Prepare a statement

Question 14

If the volume of production is increased over the level planned,the cost per unit would be expected to:

Accepted Answer

A) Decrease for fixed costs and remain unchanged for variable costs. 
B) Remain unchanged for fixed costs and increase for variable costs. 
C) Decrease for fixed costs and increase for variable costs. 
D) Increase for fixed costs and increase for variable costs. 
A) Decrease for fixed costs and remain unchanged for variable costs. 
B) Remain unchanged for fixed costs and increase for variable costs. 
C) Decrease for fixed costs and increase for variable costs. 
D) Increase for fixed costs and increase for variable costs.

Question 15

Which one of the following is not a type of cost driver?

Accepted Answer

A) Structural cost driver. 
B) Executional cost driver. 
C) Volume-Based cost driver. 
D) Differential cost driver. 
E) Activity-Based cost driver. 
A) Structural cost driver. 
B) Executional cost driver. 
C) Volume-Based cost driver. 
D) Differential cost driver. 
E) Activity-Based cost driver.

Question 16

The income statement for a manufacturing company includes:

Accepted Answer

A) Indirect Labor,Factory Overhead,and Total Manufacturing Cost. 
B) Total Manufacturing Cost and Cost of Goods Sold. 
C) Indirect Materials,Factory Overhead,and Cost of Goods Manufactured. 
D) Indirect Labor,Indirect Materials and Cost of Goods Sold. 
A) Indirect Labor,Factory Overhead,and Total Manufacturing Cost. 
B) Total Manufacturing Cost and Cost of Goods Sold. 
C) Indirect Materials,Factory Overhead,and Cost of Goods Manufactured. 
D) Indirect Labor,Indirect Materials and Cost of Goods Sold.

Question 17

A manager of a large retail firm is interested in knowing what the company's product costs are.Which of the following would be considered a product cost for the manager's company?

Accepted Answer

A) Direct materials. 
B) Direct labor. 
C) Factory overhead. 
D) Transportation costs paid by the retailer to transport the purchased product to its distribution location. 
A) Direct materials. 
B) Direct labor. 
C) Factory overhead. 
D) Transportation costs paid by the retailer to transport the purchased product to its distribution location.

Question 18

Woodcarving Co.incurred the following costs during 2010:  
What was the amount of direct materials and direct labor used for the year?

Accepted Answer

A) A 
B) B 
C) C 
D) D
= Labor + $315,000 = $460,000;Labor = $145,000.Materials + $145,000 = $390,000 = Prime Costs.Materials = $245,000 
A) A 
B) B 
C) C 
D) D
= Labor + $315,000 = $460,000;Labor = $145,000.Materials + $145,000 = $390,000 = Prime Costs.Materials = $245,000

Question 19

Consider the following for Franklin Street Manufacturing:  
What are the cost of goods manufactured and cost of goods sold?

Accepted Answer

A) A 
B) B 
C) C 
D) D
COGM = $900 + $350 = $1,250
COGS = $1,250 - $685 = $565 
A) A 
B) B 
C) C 
D) D
COGM = $900 + $350 = $1,250
COGS = $1,250 - $685 = $565

Question 20

Fashionaire Company produces children's clothing.During 2010,the company incurred the following costs:   
Inventories for the year were:   
Required: Prepare a statement of cost of goods manufactured and cost of goods sold.

Accepted Answer

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The following information applies to the Johnson Tools Company for the year ended December 31,2010:

Factory overhead costs for a given period were 2 times as much as the direct material costs.Prime costs totaled $8,000.Conversion costs totaled $11,350.What are the direct labor costs for the period?

Dave's Lighting Inc.produces lamps.During 2010,the company incurred the following costs:

Jeffrey's Bottling Co.incurred the following costs during 2010: If direct materials cost was $140,000 in 2010,what was the conversion cost for year 2010?

Furniture Co.incurred the following costs during 2010: What was the amount of direct materials and direct labor used for the year?

The following data pertains to Lam Co.'s manufacturing operations: Additional information for the month of April: Overhead is applied at $10 per direct labor hour. For the month of April,prime cost incurred was:

The following information was taken from the accounting records of Elliott Manufacturing Corp.Unfortunately,some of the data were destroyed by a computer malfunction. Cost of goods manufactured is calculated to be:

Manufacturing firms use which of the following three inventory accounts?

Assume the following information pertaining to Cub Company: Factory overhead is calculated to be:

The following data pertains to Lam Co.'s manufacturing operations: Additional information for the month of April: Overhead is applied at $10 per direct labor hour. For the month of April,cost of goods manufactured was:

The range of the cost driver in which the actual value of the cost driver is expected to fall is called the:

The following information applies to the General Lawnmower Company for the year ended December 31,2010:

If the volume of production is increased over the level planned,the cost per unit would be expected to:

Which one of the following is not a type of cost driver?

The income statement for a manufacturing company includes:

A manager of a large retail firm is interested in knowing what the company's product costs are.Which of the following would be considered a product cost for the manager's company?

Woodcarving Co.incurred the following costs during 2010: What was the amount of direct materials and direct labor used for the year?

Consider the following for Franklin Street Manufacturing: What are the cost of goods manufactured and cost of goods sold?

Fashionaire Company produces children's clothing.During 2010,the company incurred the following costs: Inventories for the year were: Required: Prepare a statement of cost of goods manufactured and cost of goods sold.

Cost Management and Strategy

Implementing Strategy: The Value Chain, the Balanced Scorecard, and the Strategy Map

Job Costing

Activity-Based Costing and Customer Profitability Analysis

Process Costing

Cost Allocation: Departments, Joint Products, and By-Products

Cost Estimation

Profit Planning: Cost-Volume-Profit Analysis

Strategy and the Master Budget

Decision Making With a Strategic Emphasis

Strategy and the Analysis of Capital Investments

Cost Planning for the Product Life Cycle: Target Costing,Theory of Constraints,and Strategic Pricing

Operational Performance Measurement: Sales and Direct-Cost Variances, and the Role of Nonfinancial Performance Measures

Operational Performance Measurement: Indirect-Cost Variances and Resource- Capacity Management

Operational Performance Measurement: Further Analysis of Productivity and Sales

The Management and Control of Quality

Strategic Performance Measurement: Cost Centers, Profit Centers, and the Balanced Scorecard

Strategic Performance Measurement: Investment Centers

Management Compensation, Business Analysis, and Business Valuation

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Exam 3: Basic Cost Management Concepts

The following information applies to the Johnson Tools Company for the year ended December 31,2010:

Factory overhead costs for a given period were 2 times as much as the direct material costs.Prime costs totaled $8,000.Conversion costs totaled $11,350.What are the direct labor costs for the period?

Dave's Lighting Inc.produces lamps.During 2010,the company incurred the following costs:

Jeffrey's Bottling Co.incurred the following costs during 2010: If direct materials cost was $140,000 in 2010,what was the conversion cost for year 2010?

Furniture Co.incurred the following costs during 2010: What was the amount of direct materials and direct labor used for the year?

The following data pertains to Lam Co.'s manufacturing operations: Additional information for the month of April: Overhead is applied at $10 per direct labor hour. For the month of April,prime cost incurred was:

The following information was taken from the accounting records of Elliott Manufacturing Corp.Unfortunately,some of the data were destroyed by a computer malfunction. Cost of goods manufactured is calculated to be:

Manufacturing firms use which of the following three inventory accounts?

Assume the following information pertaining to Cub Company: Factory overhead is calculated to be:

The following data pertains to Lam Co.'s manufacturing operations: Additional information for the month of April: Overhead is applied at $10 per direct labor hour. For the month of April,cost of goods manufactured was:

The range of the cost driver in which the actual value of the cost driver is expected to fall is called the:

The following information applies to the General Lawnmower Company for the year ended December 31,2010:

If the volume of production is increased over the level planned,the cost per unit would be expected to:

Which one of the following is not a type of cost driver?

The income statement for a manufacturing company includes:

A manager of a large retail firm is interested in knowing what the company's product costs are.Which of the following would be considered a product cost for the manager's company?

Woodcarving Co.incurred the following costs during 2010: What was the amount of direct materials and direct labor used for the year?

Consider the following for Franklin Street Manufacturing: What are the cost of goods manufactured and cost of goods sold?

Fashionaire Company produces children's clothing.During 2010,the company incurred the following costs: Inventories for the year were: Required: Prepare a statement of cost of goods manufactured and cost of goods sold.

Cost Management and Strategy

Implementing Strategy: The Value Chain, the Balanced Scorecard, and the Strategy Map

Job Costing

Activity-Based Costing and Customer Profitability Analysis

Process Costing

Cost Allocation: Departments, Joint Products, and By-Products

Cost Estimation

Profit Planning: Cost-Volume-Profit Analysis

Strategy and the Master Budget

Decision Making With a Strategic Emphasis

Strategy and the Analysis of Capital Investments

Cost Planning for the Product Life Cycle: Target Costing,Theory of Constraints,and Strategic Pricing

Operational Performance Measurement: Sales and Direct-Cost Variances, and the Role of Nonfinancial Performance Measures

Operational Performance Measurement: Indirect-Cost Variances and Resource- Capacity Management

Operational Performance Measurement: Further Analysis of Productivity and Sales

The Management and Control of Quality

Strategic Performance Measurement: Cost Centers, Profit Centers, and the Balanced Scorecard

Strategic Performance Measurement: Investment Centers

Management Compensation, Business Analysis, and Business Valuation

Filters