Question 1

Elder, Inc. has supplied the following information:   Required:
a. Compute the cost of goods manufactured.
b. Compute the cost of goods sold.
c. Compute the net income.

Accepted Answer

a. $29,900 + 8,600 + 23,500 + 16,800 + 1

Question 2

Absorption costing is also known as all of the following EXCEPT

Accepted Answer

A)  direct costing. 
B)  full costing. 
C)  traditional approach. 
D)  functional approach. 
A)  direct costing. 
B)  full costing. 
C)  traditional approach. 
D)  functional approach.

Question 3

Schultz Company reported the following information about the production and sales of its only product:
  
-The cost of producing one unit of product using absorption costing would be

Accepted Answer

A)  $64. 
B)  $52. 
C)  $90. 
D)  $80. 
A)  $64. 
B)  $52. 
C)  $90. 
D)  $80.

Question 4

A product-costing method that assigns only variable manufacturing costs to a product.

Accepted Answer

The answer of A product-costing method that assigns only variable...

Question 5

Absorption costing separates costs into manufacturing and non-manufacturing categories.

Accepted Answer

A) True 
 B)False

Question 6

A company has the following information:
  
-How much factory overhead is included in the ending inventory under absorption costing?

Accepted Answer

A)  $24,000 
B)  $12,000 
C)  $16,800 
D)  $-0- 
A)  $24,000 
B)  $12,000 
C)  $16,800 
D)  $-0-

Question 7

Which of the following statements is TRUE?

Accepted Answer

A)  Indirect costs can be identified specifically with a given cost objective in an economically feasible way. 
B)  Managers prefer to classify costs as indirect rather than direct. 
C)  A cost may simultaneously be direct and indirect. 
D)  Direct costs cannot be identified specifically with a given cost objective in an economically feasible way. 
A)  Indirect costs can be identified specifically with a given cost objective in an economically feasible way. 
B)  Managers prefer to classify costs as indirect rather than direct. 
C)  A cost may simultaneously be direct and indirect. 
D)  Direct costs cannot be identified specifically with a given cost objective in an economically feasible way.

Question 8

Which of the following is NOT considered a payroll fringe cost?

Accepted Answer

A)  Idle time 
B)  Pension plan contributions 
C)  Social security payment 
D)  Health insurance coverage 
A)  Idle time 
B)  Pension plan contributions 
C)  Social security payment 
D)  Health insurance coverage

Question 9

Sales revenue less cost of goods sold.

Accepted Answer

The answer of Sales revenue less cost of goods sold....

Question 10

Costs that can be identified specifically and exclusively with a given cost objective in an economically feasible way.

Accepted Answer

The answer of Costs that can be identified specifically and...

Question 11

The following information was taken from the records of the Gallon Company for the year ended December 31, 20X4. There were no beginning or ending inventories.   Prepare an income statement for the year ended December 31, 20X4 using both the absorption approach and the contribution approach.

Accepted Answer

The answer of The following information was taken from the...

Question 12

A company has the following information:
  
-The total contribution margin under variable costing would be

Accepted Answer

A)  $42,000. 
B)  $14,000. 
C)  $66,000. 
D)  $72,000. 
A)  $42,000. 
B)  $14,000. 
C)  $66,000. 
D)  $72,000.

Question 13

Bowzer Industries began operations on January 1, 2006. The company sells a single product for $10 per unit. During 2006, 60,000 units were produced and 50,000 units were sold. There was no work in process inventory at December 31, 2006.
Bowzer uses an actual cost system for product costing and actual costs for 1998 were as follows:   a. What is the product cost per unit under:
(i) variable costing
(ii) absorption costing
b. What is the finished goods inventory cost at December 31, 2006 under:
(i) variable costing
(ii) absorption costing
c. Prepare income statements for 2006 under:
(i) variable costing
(ii) absorption costing
d. Reconcile the difference between variable costing income and absorption costing income.

Accepted Answer

a. Cost per unit using variable costing:

Question 14

Prime costs include

Accepted Answer

A)  direct labour and factory overhead. 
B)  direct materials and indirect labour. 
C)  factory overhead and indirect materials. 
D)  direct labour and direct materials. 
A)  direct labour and factory overhead. 
B)  direct materials and indirect labour. 
C)  factory overhead and indirect materials. 
D)  direct labour and direct materials.

Question 15

Expenses that are not directly traceable to a particular segment and are unaffected by the elimination of any one segment.

Accepted Answer

Common fix

Question 16

The term expense is used to describe both an inventory expenditure and a cost.

Accepted Answer

A) True 
 B)False

Question 17

The Minler Company began the year 2006 with no inventories of work in process or finished goods. The company produces a single product, and cost data for the product are given below.   The company uses an actual cost system. The selling price of the product is $50 per unit. There were no work in process inventories at the end of each month.
a. Determine the unit cost of production for each month under:
(i) variable costing
(ii) absorption costing
b. Prepare income statements for the three months under:
(i) variable costing
(ii) absorption costing
c. If selling prices and costs do not change significantly, what can be said about the relationship of income under absorption costing and variable costing when:
(i) sales equal production
(ii) sales are less than production
(iii) sales are greater than production

Accepted Answer

a. Unit cost of production under variabl

Question 18

In the contribution approach, all factory overhead is considered to be product costs that are expensed as incurred.

Accepted Answer

A) True 
 B)False

Question 19

The following information refers to the Cowan Company's past year of operations.
       *Common overhead totals $50,000 and is divided equally between the two products.
**Common fixed selling totals $60,000 and is divided equally between the two products.
Budgeted fixed overhead for the year of $180,000 equalled actual fixed overhead. Fixed overhead is assigned to products using a plant-wide rate based on expected direct labour hours, which were 150,000. The company had 5,000 of Product B in inventory at the beginning of the year. These units had the same unit cost as the units produced during the year.
-Using absorption costing, cost of goods sold for the year is

Accepted Answer

A)  $1,050,000. 
B)  $912,000. 
C)  $797,000. 
D)  $760,000. 
A)  $1,050,000. 
B)  $912,000. 
C)  $797,000. 
D)  $760,000.

Question 20

Cost accounting system typically includes two processes, cost accumulation and cost determination.

Accepted Answer

A) True 
 B)False

Elder, Inc. has supplied the following information: Required: a. Compute the cost of goods manufactured. b. Compute the cost of goods sold. c. Compute the net income.

Absorption costing is also known as all of the following EXCEPT

Schultz Company reported the following information about the production and sales of its only product: -The cost of producing one unit of product using absorption costing would be

A product-costing method that assigns only variable manufacturing costs to a product.

Absorption costing separates costs into manufacturing and non-manufacturing categories.

A company has the following information: -How much factory overhead is included in the ending inventory under absorption costing?

Which of the following statements is TRUE?

Which of the following is NOT considered a payroll fringe cost?

Sales revenue less cost of goods sold.

Costs that can be identified specifically and exclusively with a given cost objective in an economically feasible way.

The following information was taken from the records of the Gallon Company for the year ended December 31, 20X4. There were no beginning or ending inventories. Prepare an income statement for the year ended December 31, 20X4 using both the absorption approach and the contribution approach.

A company has the following information: -The total contribution margin under variable costing would be

Prime costs include

Expenses that are not directly traceable to a particular segment and are unaffected by the elimination of any one segment.

The term expense is used to describe both an inventory expenditure and a cost.

In the contribution approach, all factory overhead is considered to be product costs that are expensed as incurred.

Cost accounting system typically includes two processes, cost accumulation and cost determination.

Management Accounting and Management Decisions

Cost Behaviour and Cost-Volume Relationships

Measurement of Cost Behaviour

Cost Allocation and Activity-Based Costing Systems

Job-Costing Systems

Process-Costing Systems

Relevant Information and Decision Making: Marketing Decisions

Relevant Information and Decision Making: Production Decisions

Capital Budgeting Decisions

The Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems, the Balanced Scorecard, and Responsibility Accounting

Management Control in Decentralized Organizations

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Exam 4: Cost Management Systems

Elder, Inc. has supplied the following information: Required: a. Compute the cost of goods manufactured. b. Compute the cost of goods sold. c. Compute the net income.

Absorption costing is also known as all of the following EXCEPT

Schultz Company reported the following information about the production and sales of its only product: -The cost of producing one unit of product using absorption costing would be

A product-costing method that assigns only variable manufacturing costs to a product.

Absorption costing separates costs into manufacturing and non-manufacturing categories.

A company has the following information: -How much factory overhead is included in the ending inventory under absorption costing?

Which of the following statements is TRUE?

Which of the following is NOT considered a payroll fringe cost?

Sales revenue less cost of goods sold.

Costs that can be identified specifically and exclusively with a given cost objective in an economically feasible way.

The following information was taken from the records of the Gallon Company for the year ended December 31, 20X4. There were no beginning or ending inventories. Prepare an income statement for the year ended December 31, 20X4 using both the absorption approach and the contribution approach.

A company has the following information: -The total contribution margin under variable costing would be

Prime costs include

Expenses that are not directly traceable to a particular segment and are unaffected by the elimination of any one segment.

The term expense is used to describe both an inventory expenditure and a cost.

In the contribution approach, all factory overhead is considered to be product costs that are expensed as incurred.

Cost accounting system typically includes two processes, cost accumulation and cost determination.

Management Accounting and Management Decisions

Cost Behaviour and Cost-Volume Relationships

Measurement of Cost Behaviour

Cost Allocation and Activity-Based Costing Systems

Job-Costing Systems

Process-Costing Systems

Relevant Information and Decision Making: Marketing Decisions

Relevant Information and Decision Making: Production Decisions

Capital Budgeting Decisions

The Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems, the Balanced Scorecard, and Responsibility Accounting

Management Control in Decentralized Organizations

Filters